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EPOS Technologies Ltd. v. Pegasus Technologies Ltd.

United States Court of Appeals, Federal Circuit

September 5, 2014

EPOS TECHNOLOGIES LTD., Plaintiff/Counterclaim Defendant-Appellee,
v.
PEGASUS TECHNOLOGIES LTD., Defendant/Counterclaimant-Appellant, and DANE-ELEC S.A., DANE-ELEC MEMORY S.A., AND DANE-ELEC CORPORATION USA, Counterclaim Defendants, AND LUIDIA, INC., Counterclaimant-Appellant

Page 1339

Appeal from the United States District Court for the District of Columbia in No. 07-CV-0416, Judge William M. Nickerson.

Deanne E. Maynard, Morrison & Foerster LLP, of Washington, DC, argued for plaintiff/counterclaim Defendant-appellee. With her on the brief were Anthony L. Press, Hector G. Gallegos, Wendy J. Ray, and Christian G. Andreu-Von Euw, of Los Angeles, California.

William P. Atkins, Pillsbury Winthrop Shaw Pittman LLP, of McLean, Virginia, argued for defendant/counterclaimant-appellant and counterclaimant-appellant. With him on the brief were Christopher K. Dorsey, and A. John Demarco, of Washington, DC.

HUGHES and BRYSON, Circuit Judges[*].

OPINION

Page 1340

HUGHES, Circuit Judge.

Appellants, Pegasus Technologies Ltd. and Luidia, Inc., own several patents relating to digital pens and receiver devices which, they allege, the Appellees have infringed. Following claim construction of certain terms in the patents, the district court granted summary judgment of noninfringement in favor of Appellees. Because we conclude that the district court erred in construing four claim terms and in granting summary judgment of noninfringement, we vacate-in-part, reverse-in-part, and remand for further proceedings consistent with this opinion.

I

Appellants allege infringement of six patents: U.S. Patent Nos. 6,266,051;

Page 1341

6,326,565; 6,392,330; 6,501,461; 6,724,371; and 6,841,742. The patents relate to pens that digitize writing and devices for retrofitting writing surfaces so that writing can be digitally captured. See, e.g., '371 patent col. 1 ll. 6-9. The Appellees, EPOS Technologies Ltd., Dane-Elec S.A., Dane-Elec Memory S.A., and Dane-Elec Corp. USA (collectively, EPOS), manufacture and sell products used to digitize writing (EPOS Products). These products include a receiver unit with a spring-loaded, U-shaped clip-on bracket and a pen refill.

In 2007, EPOS Technologies Ltd. filed a complaint against Pegasus Technologies Ltd. seeking declaratory judgment of noninfringement of the '565, '330, '371, and '742 patents. Pegasus filed an answer and counterclaims, adding Luidia, Inc. as a counterclaim plaintiff (collectively, Pegasus). Pegasus also asserted infringement of two additional patents in its counterclaims, the '051 and '461 patents, resulting in a total of six asserted patents. After claim construction, EPOS moved for summary judgment of invalidity and noninfringement. The district court granted the motion and declined to address invalidity in light of its nonfringement rulings. Pegasus appeals the district court's construction of four claim terms and the district court's grant of summary judgment of noninfringement. We have jurisdiction under 28 U.S.C. § 1295(a)(1).

II

" Claim construction is a legal statement of the scope of the patent right" that we review de novo. Lighting Ballast Control LLC v. Philips Elecs. N. Am. Corp., 744 F.3d 1272, 1276-77, 1284 (Fed. Cir. 2014) (en banc); Cybor Corp. v. FAS Techs., Inc., 138 F.3d 1448, 1456 (Fed. Cir. 1998) (en banc). Claim terms are generally given their ordinary and customary meaning as understood by a person of ordinary skill in the art. Phillips v. AWH Corp., 415 F.3d 1303, 1312-13 (Fed. Cir. 2005) (en banc). The person of ordinary skill in the art is " deemed to read the claim term not only in the context of the particular claim in which the disputed term appears, but in the context of the entire patent, including the specification." Id. at 1313. On the other hand, " it is improper to read limitations from a preferred embodiment described in the specification--even if it is the only embodiment--into the claims absent a clear indication in the intrinsic record that the patentee intended the claims to be so limited." Liebel-Flarsheim v. Medrad, Inc., 358 F.3d 898, 913 (Fed. Cir. 2004). We recognize that " the distinction between . . . interpret[ing] the meaning of a claim and importing limitations . . . into the claim can be a difficult one to apply in practice." Phillips, 415 F.3d at 1323. Nevertheless, " [t]he construction that stays true to the claim language and most naturally aligns with the patent's description of the invention will be, in the end, the correct construction." Id. at 1316 (citation omitted) (quotation omitted).

We review a grant of summary judgment under the law of the regional circuit, here the D.C. Circuit. Charles Mach. Works, Inc. v. Vermeer Mfg. Co., 723 F.3d 1376, 1378 (Fed. Cir. 2013). The D.C. Circuit reviews a district court's grant of summary judgment de novo, Coalition for Common Sense in Government Procurement v. United States, 707 F.3d 311, 315, 404 U.S.App. D.C. 13 (D.C. Cir. 2013), drawing all reasonable inferences in favor of the nonmovant, Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Summary judgment is appropriate when there is " no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a).

Page 1342

Infringement is a question of fact. Charles Machine, 723 F.3d at 1378. On appeal from a grant of summary judgment of noninfringement, " we must determine whether, after resolving reasonable factual inferences in favor of the patentee, the district court correctly concluded that no reasonable jury could find infringement." Id. (quoting Crown Packaging Tech., Inc. v. Rexam Beverage Can Co., 559 F.3d 1308, 1312 (Fed. Cir. 2009)) (internal quotation marks omitted).

III

Pegasus appeals the district court's construction of " drawing implement" and " given time interval" in the '565 and '742 patents, " marking implement" in the '461 patent, and " temporary attachment" in the '051 patent. The district court erroneously construed these four terms. Because of the erroneous claim constructions, the district court erred by granting summary judgment of noninfringement of the '565, '742, '461, and '051 patents.

A

The '565 and '742 patents relate to digitizing writing on presentation boards. The '742 patent discloses a transmitter device for use with conventional writing implements. '742 patent abstract, col. 2 ll. 29-41. The '565 patent addresses data loss caused by a data transmission delay after the end of each pen stroke or resynchronization delay. '565 patent col. 4 ll. 58-61. According to the '565 patent, this delay is particularly problematic for short strokes because it may cause some of the information conveyed by the stroke to not be recorded. '565 patent col. 4 ll. 54-57. The '565 patent addresses this problem by " maintaining synchronization between the transmitter device 40 and the receiver system for a given period of time after the end of each pen stroke." '565 patent col. 4 ll. 58-61.

Claim 1 of the '565 patent and claim 2 of the '742 patent are representative. Claim 1 of the '565 patent recites:

A transmitter device for use with a system for digitizing operative strokes of a handheld drawing implement, the drawing implement having a body and an operative tip, the transmitter device comprising:
a housing;
a transmitter mounted relative to said housing;
a microswitch that is responsive to a force exerted on the operative tip of the drawing ...

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