Akamai Technologies, Inc. v. Limelight Networks, Inc.
805 F.3d 1368
| Fed. Cir. | 2015Background
- Akamai sued Limelight for infringement of the ’703 patent (claims 19–21, 34) and asserted claims of the ’413 and ’645 patents; jury found Limelight directly infringing the ’703 patent and awarded lost profits and other damages.
- District court granted JMOL of non-infringement based on divided infringement; that JMOL was reversed en banc and the case returned to this panel to resolve residual issues.
- Parties had stipulated constructions: “tagging” = providing a pointer/hook so the object resolves to a domain other than the content provider domain; that domain specification = a particular group of computers not including the content provider from which an optimal server is to be selected.
- Disputes on remand focused on three issues raised by Limelight’s cross-appeal: (1) whether “tagging” should be limited to prepending/inserting a virtual server hostname into the URL; (2) whether “an optimal server” requires a single aggregate “best” server or can be one or more servers meeting criteria; and (3) whether Akamai’s lost-profits expert provided a legally sufficient basis for the jury’s award.
- The jury had awarded roughly $40 million in lost profits (Dr. Ugone’s model produced ~$74M but jury awarded less); Dr. Ugone used an adjusted-market-share approach with elasticity and customer exclusions to estimate but‑for sales.
- The panel affirms the en banc reversal of JMOL, upholds the district court’s claim constructions and jury instruction, and affirms allowance of the lost‑profits expert; remands to reinstate the jury verdict and damages; separately confirms non‑infringement rulings on the ’413 and ’645 patents.
Issues
| Issue | Plaintiff's Argument (Akamai) | Defendant's Argument (Limelight) | Held |
|---|---|---|---|
| Construction of “tagging” — whether limited to prepending/inserting a virtual hostname | Stipulated broad meaning governs; patent does not clearly limit tagging to prepending and some claims expressly recite prepending (so tagging is broader) | Term should be limited to prepending/inserting a virtual server hostname because specification and related ’645 patent use that method | Court: Tagging not limited to preferred embodiment; Limelight bound by stipulation; construction affirmed (no prepending limitation) |
| Construction of “an optimal server” — single aggregate best vs. one or more servers meeting criteria | “Optimal” can refer to one or more servers that are better than alternatives based on listed criteria; selection can vary by circumstance | “Optimal” unambiguously means a single aggregate best server; jury was improperly left to resolve construction | Court: Construction allowing one or more servers meeting criteria is supported by intrinsic evidence and dependent claims; instruction lawful; Limelight’s estoppel argument rejected |
| Admissibility/reliability of lost‑profits evidence (Dr. Ugone’s adjusted market‑share model) | Expert used accepted adjusted‑market‑share methodology, accounted for price differential via elasticity and excluded most price‑sensitive customers; grounded in economic principles | Model arbitrary and legally insufficient given large price disparity between products; market segmentation prevents lost profits recovery | Court: Adjusted market‑share approach and elasticity adjustments are legally permissible and sufficiently supported; district court did not err in admitting the expert; award reinstated |
Key Cases Cited
- Teva Pharm. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831 (2015) (standard of review for claim construction and factual findings)
- Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (claim construction principles and patentee lexicography)
- Innova/Pure Water, Inc. v. Safari Water Filtration Sys., 381 F.3d 1111 (Fed. Cir. 2004) (claims not limited to single embodiment absent clear intent to limit)
- Ericsson, Inc. v. Harris Corp., 352 F.3d 1369 (Fed. Cir. 2004) (approved use of adjusted market‑share analyses for lost profits)
- O2 Micro Int’l Ltd. v. Beyond Innovation Tech. Co., 521 F.3d 1351 (Fed. Cir. 2008) (parties may present disputes over claim scope; context matters for stipulations)
- BIC Leisure Prods., Inc. v. Windsurfing Int’l, Inc., 1 F.3d 1214 (Fed. Cir. 1993) (lost profits unavailable where markets were distinct and demand elastic)