Ericsson, Inc. v. D-Link Systems, Inc.
773 F.3d 1201
| Fed. Cir. | 2014Background
- Ericsson sued D-Link et al. in the Eastern District of Texas for infringement of multiple 802.11(n) SEPs tied to Wi‑Fi standards.
- Intel intervened as the chip supplier; trial addressed three patents: the '568, '215, and '625.
- Jury found infringement on '568 and '215, with damages around $10 million (about 15 cents per infringing device).
- The district court denied post-trial relief, including challenges to the EMVR and RAND-related jury instructions; post-trial proceedings focused on damages.
- Dell previously had a Master Purchase Agreement with Ericsson AB; Dell assignment dispute arose regarding whether Ericsson AB could license Dell under that agreement.
- This court affirms-in-part, reverses-in-part, vacates-in-part, and remands for further proceedings on liability and damages issues with RAND considerations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Infringement of the '568 patent | Ericsson showed the TID field can identify payload type. | TID is a priority field, not payload-type identifier; no infringement. | Substantial evidence supports infringement under flexible capability theory. |
| Infringement of the '215 patent (claim construction) | Type identifier field identifies feedback format; selection/minimization possible. | District court erred by not adopting narrower construction; no infringing use. | Court approved district construction; Ericsson can rely on induced infringement; upheld infringement finding on '215. |
| Infringement of the '625 patent | Transmitter commands receiver to accept out-of-order packets; claims cover this. | Receivers already accept out-of-order packets; no command by transmitter. | Jury finding of infringement reversed; no infringement under the proper reading of claim 1. |
| Damages under EMVR and RAND | Licenses cited reflect value apportioned to patented features; licenses admissible. | Potential EMVR violation; improper use of licenses and improper jury instructions. | Damages vacated and remanded for proper apportionment and RAND-focused instructions. |
| Dell license via MPA and agency | LM Ericsson could license and authorize Dell under MPA via agency. | LM Ericsson not an agent of Ericsson AB; no license to Dell under MPA. | Dell not licensed; agency finding supports Dell’s non-licensure. |
Key Cases Cited
- Finjan, Inc. v. Secure Computing Corp., 626 F.3d 1197 (Fed. Cir. 2010) (claim language drawn to capability and selective embodiment discusses functional limits)
- Ball Aerosol & Specialty Container, Inc. v. Limited Brands, Inc., 555 F.3d 984 (Fed. Cir. 2009) (analysis of operation versus capability in claims)
- Versata Software, Inc. v. SAP Am., Inc., 717 F.3d 1255 (Fed. Cir. 2013) (capability-based infringement analysis for system claims)
- SiRF Tech., Inc. v. Int’l Trade Comm’n, 601 F.3d 1319 (Fed. Cir. 2010) (direct infringement where end products automatically perform steps by user/consumption)
- Ricoh Co. v. Quanta Computer, Inc., 550 F.3d 1325 (Fed. Cir. 2008) (distinguishes sale of software containing instructions from actual method performance)
- Aristocrat Techs. Australia Pty Ltd. v. Int’l Game Tech., 709 F.3d 1348 (Fed. Cir. 2013) (direct infringement limits in method claims require actual performance by accused party)
- Garretson v. Clark, 111 U.S. 120 (Supreme Court 1884) (apportionment principle for value of patented improvements in standards cases)
- Uniloc USA, Inc. v. Microsoft Corp., 632 F.3d 1292 (Fed. Cir. 2011) (apportionment and evaluation of damages in value-based royalty scenarios)
- LaserDynamics, Inc. v. Quanta Computer, Inc., 694 F.3d 51 (Fed. Cir. 2012) (limits on royalty base in multi-component product damages to avoid overcompensation)
- VirnetX, Inc. v. Cisco Systems, Inc., 767 F.3d 1308 (Fed. Cir. 2014) (RAND/SEP considerations; apportionment and value of patented feature versus standardization)