On October 3, 2013, the U.S. Court of Appeals for the Federal Circuit issued a precedential opinion in Microsoft Corp. v. ITC (2012-1445, -1535).  This was an appeal from the International Trade Commission’s (“the Commission”) final determination finding no violation of Section 337 of some of the asserted patents in Certain Mobile Devices, and Related Software Thereof (Inv. No. 337-TA-744).  See our June 18, 2012 and December 21, 2011 posts for more details.

By way of background, the Complainant in this case is Microsoft Corporation (“Microsoft”) and the Respondent is Motorola Mobility, Inc. (“Motorola”).  The technology at issue spans several patents, including a number of functionalities and features that are implemented on desktop computers and mobile devices.  On December 20, 2011, ALJ Theodore R. Essex issued the initial determination (“ID”) in this investigation finding a violation of Section 337 with respect to certain claims of U.S. Patent No. 6,370,566 (the ‘566 patent) and finding no violation with respect to certain claims of U.S. Patent Nos. 5,758,352 (the ‘352 patent), 6,826,762 (the ‘762 patent), 6,909,910 (the ‘910 patent), 7,644,376 (the ‘376 patent), 5,664,133 (the ‘133 patent), and 6,578,054 (the ‘054 patent) (collectively, “the asserted patents”). 

Upon review, the Commission in part found no infringement of the ‘762, ‘054, ‘376, and ‘133 patents, and further, found that Microsoft failed to prove that there was a domestic industry related to articles protected by the ‘054, ‘762, and ‘376 patents.  Microsoft appealed this decision.

The ‘054 Patent

According to the opinion, the ‘054 patent discloses a system and method for synchronizing copies of a data resource (for example, a document) in a client-server environment where multiple clients can make changes to their copy of the resource.  The infringement dispute was based on the claim’s requirement of “resource state information.”  Although the parties asserted that this term needed no construction, ALJ Essex independently construed it to mean “information that is associated with a resource that allows the server, client computer, or both to determine the version of the resource stored on the server at a particular moment…and to take appropriate action to synchronize the documents if there has been a change.”   Based on that construction, the ALJ found that the accused products do not infringe the ‘054 patent because they do not use “resource state information” for synchronization.

On appeal, Microsoft did not challenge the finding of infringement (reviewed under the substantial-evidence standard), but instead challenged the ALJ’s claim construction, which is reviewed without deference.  Although Microsoft argued that the ALJ imported additional limitations into the claim via this construction, the Federal Circuit agreed with the ALJ.  According to the Court, the specification “makes clear, consistent with the invention’s function of synchronizing, that ‘resource state information’ must provide information about the comparative recentness of a particular version,” and thus the Federal Circuit found no error in the ALJ’s construction requiring some information allowing determination of the most recent version.  As such, the Commission’s determination that the accused products do not infringe the ‘054 patent was affirmed, and thus there was no violation of Section 337 in relation to the ‘054 patent.

The ‘376 Patent

According to the opinion, the ‘376 patent is directed to a mechanism for notifying application programs about changes to the state of mobile-device components relevant to the application.  The asserted claims include the term “notification broker” which was given its plain and ordinary meaning by the ALJ.  The “notification broker” is coupled to the “client applications.”  The ALJ found that the requirement of “direct” access meant that the accused products did not infringe.  Furthermore, the ALJ concluded that the accused products did not meet the “client applications” limitation, as the “coupled” aspect of the claims meant that these are separate components.

The ALJ also determined that Microsoft had failed to show that the technical prong of the domestic industry requirement was met in relation to the ‘376 patent by failing to “offer sufficient proof of articles that were actually protected by the patent.”  The Commission agreed, noting that Microsoft’s expert was unable to identify “client applications” in any device.  The Court agreed, noting “there is substantial evidence to support the Commission’s determination that Microsoft failed to meet that requirement.”  As such, there was no Section 337 violation in relation to the ‘376 patent, with the Court noting that it did not reach Microsoft’s challenge to the non-infringement determination.

The ‘762 Patent

According to the opinion, the ‘762 patent describes a radio interface layer between radio hardware and software applications in a cell phone, allowing applications to issue commands without knowledge of the underlying radio structure of the phone.  The claims include a “hardware-independent” proxy layer.  The parties agreed that “hardware-independent” meant “without regard to a specific hardware implementation.”  However, this was modified by the ALJ such that a complete lack of knowledge was not required, only that the proxy layer be independent of the network characteristics of the hardware.  Based on that construction, the ALJ found that Motorola’s products did not infringe, as they did not contain a “hardware-independent” proxy layer.  The ALJ also found that Microsoft was unable to prove that the technical prong of the domestic industry requirement was met in relation to actual products, and this finding was affirmed by the Commission.

The Court held that there was substantial evidence to support the Commission’s determination with regard to the domestic industry requirement.  According to the opinion, a witness testifying in the investigation “could not identify a single third-party mobile-device manufacturer that implemented Microsoft’s example driver-layer code.”  Therefore, since the Commission could find sufficient proof that the domestic industry requirement was not met, it could properly find no Section 337 violation, and again the Court affirmed the finding without reaching the issue of infringement.

The ‘133 Patent

According to the opinion, the ‘133 patent is directed to a graphical user interface that represents actual computer resources in relation to location and the class of the resource.  The ALJ construed phrases including “a menu selection…” as “a choice or option in a menu ….”  In light of that construction, the accused products were found not to infringe because each application acts upon only a single class of object, rather than selecting a class from a plurality and then acting upon the class.  The ALJ also found that the accused products do not meet the requirement for display of the menu in proximity of a graphical representation of a particular object.  Although the menu may on occasion be positioned in proximity to the representation of the selected object, it is not “deliberately” positioned near the on-screen representation. 

The Federal Circuit reversed the finding of no infringement, holding that the notion of “deliberate” positioning was not present in the claim construction.  The Court also found that Motorola’s alternative design also infringed the ‘133 patent.  Furthermore, since the ALJ and Commission only addressed direct infringement, the Court remanded the case so that the issue of indirect infringement can be addressed.