Jvc Kenwood Corporation v. Nero, Inc.
797 F.3d 1039
| Fed. Cir. | 2015Background
- JVC sued Nero and Arcsoft for contributory and induced infringement based on Nero’s sale of optical-disc software; JVC alleged end users directly infringe JVC patents when using Nero software with DVD/Blu‑ray discs.
- JVC’s infringement theory: Nero’s software complies with DVD/Blu‑ray standards to which JVC’s asserted patents are “essential,” so use of the software with standards‑compliant discs necessarily practices the claimed inventions.
- The asserted patents cover various disc‑related method and product claims (jump reproduction, parental/regional controls, recording regions, audio/video multiplexing and editing). JVC relied on standards‑compliance rather than evidence of specific unlicensed discs or specific end‑user acts.
- The district court granted summary judgment for Nero, holding that JVC failed to show direct infringement under its standards‑compliance theory and that licensees of the industry patent pools negate inferred infringement absent evidence of unlicensed discs; it alternatively found patent exhaustion but the court of appeals vacated that alternative ruling.
- The Ninth Circuit affirmed summary judgment on non‑infringement (because JVC relied on standards/pooled licensing without showing unlicensed products or specific direct infringement) but vacated the district court’s patent‑exhaustion conclusion as the record was insufficient.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether end users directly infringe the patents when using Nero software with standards‑compliant discs | Standards are co‑extensive with claim language; software used with standards‑compliant discs necessarily practices the patents | JVC offered no evidence of unlicensed discs or specific direct infringement; industry pool licenses mean many disc makers are licensed | Affirmed: JVC failed to prove direct infringement on its standards‑compliance theory; summary judgment for Nero appropriate |
| Whether Nero can be liable for induced/contributory infringement absent proof of direct infringement by end users | Indirect liability follows because Nero’s customers necessarily directly infringe when using Nero software with standard discs | Without proof of direct infringement, indirect infringement cannot stand | Affirmed: no indirect infringement without direct infringement proof |
| Whether patent exhaustion bars JVC’s claims (district court alternative ground) | JVC’s theory both supports and undermines exhaustion; some discs may be unlicensed, so exhaustion not established | District court found licensed disc sales substantially embody the patents and trigger exhaustion | Vacated as to exhaustion: appellate court found record insufficient to establish authorized sales/substantial embodiment required by Quanta |
| Whether district court abused its discretion in striking JVC’s declarations (experts, employee, attorney) | Declarations supplied missing factual support (e.g., alternative disc uses, licensing lists) | Declarations contradicted JVC’s litigation positions or were irrelevant/hearsay; striking was within discretion | Affirmed: no abuse of discretion in striking those declarations |
Key Cases Cited
- Quanta Computer, Inc. v. LG Electronics, Inc., 553 U.S. 617 (Sup. Ct.) (establishes authorized sale + substantial embodiment tests for patent exhaustion)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (Sup. Ct.) (summary judgment standard; no genuine dispute of material fact)
- LifeScan Scotland, Ltd. v. Shasta Techs., LLC, 734 F.3d 1361 (Fed. Cir.) (explains factors for substantial embodiment under Quanta)
- Helferich Patent Licensing, LLC v. New York Times Co., 778 F.3d 1293 (Fed. Cir.) (observes patent exhaustion is a judicial doctrine with limits)
- Earl v. Nielsen Media Research, Inc., 658 F.3d 1108 (9th Cir.) (standard of review for summary judgment in Ninth Circuit)