Commil USA, Llc v. Cisco Systems, Inc.
720 F.3d 1361
Fed. Cir.2013Background
- Commil sued Cisco alleging direct and induced infringement of U.S. Patent No. 6,430,395 (the '395 patent), a method for dividing a short-range communication protocol into a low‑level (time‑sensitive) and high‑level (non‑time‑sensitive) protocol and running corresponding instances at base stations and a switch.
- First jury (May 2010) found no induced infringement, found claims valid, found Cisco liable for direct infringement, and awarded ~$3.7M; district court later granted a partial new trial on inducement and damages.
- Second jury (April 2011) found induced infringement and awarded ~$63.7M; judgment entered including prejudgment interest and costs; Cisco appealed.
- On appeal, the Federal Circuit held the district court gave an erroneous jury instruction on inducement (permitting liability on a negligence/should‑have‑known standard) contrary to the Supreme Court’s Global‑Tech decision and vacated the induced‑infringement verdict and damages.
- The court further held that evidence of a defendant’s good‑faith belief in patent invalidity is admissible to negate the specific intent required for inducement and that excluding that evidence was error.
Issues
| Issue | Plaintiff's Argument (Commil) | Defendant's Argument (Cisco) | Held |
|---|---|---|---|
| Jury instruction on inducement standard | Instruction was proper; circumstantial evidence could show knowledge | Instruction misstated law by allowing “knew or should have known,” permitting negligence standard | Instruction was legally erroneous under Global‑Tech; vacated induced‑infringement verdict and damages |
| Admissibility of good‑faith belief of invalidity to rebut intent | Such belief is irrelevant to inducement once jury upheld validity | Belief of invalidity shows lack of specific intent to induce and should be admissible | Evidence of good‑faith belief of invalidity may negate specific intent and is admissible to the factfinder |
| Grant of partial new trial (inducement and damages only) | New trial on those issues was warranted based on counsel misconduct | Partial new trial violated Seventh Amendment because validity and inducement are interwoven | Grant of a partial new trial was not an abuse of discretion and did not violate the Seventh Amendment; affirmed (as to new trial) |
| Claim construction of “short‑range communication protocol” | Term should be limited to specific protocols listed in specification | Term means a set of procedures to initiate and maintain short‑range communication (not limited to examples) | Court affirmed the district court’s broader construction; specification examples not imported into claim |
Key Cases Cited
- Global‑Tech Appliances, Inc. v. SEB S.A., 563 U.S. 754 (2011) (induced infringement requires knowledge that induced acts constitute patent infringement; knowledge may be actual or willful blindness; negligence insufficient)
- DSU Medical Corp. v. JMS Co., Ltd., 471 F.3d 1293 (Fed. Cir. 2006) (discussing knowledge requirement and circumstantial evidence for inducement)
- Manville Sales Corp. v. Paramount Sys., Inc., 917 F.2d 544 (Fed. Cir. 1990) (earlier Federal Circuit standard permitting a ‘‘knew or should have known’’ formulation)
- Sulzer Textil A.G. v. Picanol N.V., 358 F.3d 1356 (Fed. Cir. 2004) (standards for reviewing jury instructions in patent cases)
- Environ Prods., Inc. v. Furon Co., 215 F.3d 1261 (Fed. Cir. 2000) (harmless error standard for jury instruction errors)
- Prima Tek II, L.L.C. v. Polypap, S.A.R.L., 412 F.3d 1284 (Fed. Cir. 2005) (invalid patent cannot be infringed; invalidity as ultimate defense)
- Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (claim construction principles; avoid importing limitations from specification)
- In re Seagate Tech., LLC, 497 F.3d 1360 (Fed. Cir. 2007) (willfulness standard and objective prong analysis)
- Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich LPA, 559 U.S. 573 (2010) (a good‑faith legal mistake does not necessarily excuse civil liability)