Liberty Ammunition, Inc. v. United States
835 F.3d 1388
| Fed. Cir. | 2016Background
- Liberty Ammunition owns U.S. Patent No. 7,748,325 directed to a non‑jacketed projectile with a nose, tail, and an intermediate "interface" that reduces barrel contact and ruptures on soft‑tissue impact.
- Inventor P.J. Marx met Army official Glenn (then Maj.) Dean in 2005, signed an NDA, and left sample EPIC rounds with the Army; later the Army developed M855A1 and M80A1 rounds.
- Liberty sued under 28 U.S.C. § 1498, alleging the Army’s M855A1 and M80A1 practice asserted claims of the ’325 patent and alleging breach of contract based on the NDA signed with Lt. Col. Dean.
- The Court of Federal Claims construed claims, found infringement and validity, awarded damages, but held the NDA unenforceable because Dean lacked authority to bind the government.
- On appeal, the Government challenged two claim constructions; Liberty cross‑appealed the NDA ruling. The Federal Circuit reviewed claim construction de novo and factual authority findings for clear error.
- The Federal Circuit reversed infringement (and vacated damages) because it redrafted two claim constructions (baseline for “reduced area of contact” and meaning of “intermediate opposite ends”) and affirmed that the NDA was unenforceable for lack of actual authority.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Construction of “reduced area of contact” (claim 1) | Liberty: baseline is a "traditional jacketed lead bullet" (trial ct. construction across calibers). | Gov: baseline should be the conventional jacketed projectile identified in the spec—i.e., the corresponding NATO standard (M855 for 5.56 mm; M80 for 7.62 mm). | Court: adopt Gov’s construction—baseline is the corresponding NATO standard‑issue round as of Oct. 21, 2005 (M855 for 5.56, M80 for 7.62); Liberty failed to prove accused rounds meet this limitation. |
| Construction of “intermediate opposite ends” (claim 32) | Liberty/trial ct.: "including" allows an interface that can extend beyond the middle as long as part is between ends. | Gov: interface must be positioned between front and rear ends and not extend all the way to either end. | Court: adopt Gov’s construction; accused M855A1/M80A1 interfaces extend to a projectile end and thus do not meet this limitation. |
| Infringement given corrected constructions | Liberty: accused Army rounds embody claimed features under trial court constructions. | Gov: with proper constructions, accused rounds do not meet required limitations. | Court: No infringement — neither asserted independent claim (1 or 32) is practiced by the Government; damages vacated. |
| Enforceability of NDA signed by Lt. Col. Dean | Liberty: Dean had implied actual authority as Chief of Small Arms to sign NDAs; NDA creates contractual obligations. | Gov: Dean lacked actual (express or implied) authority to bind the United States; apparent authority insufficient against gov’t. | Court: Affirmed trial court — no clear error in finding Dean lacked implied actual authority; NDA unenforceable against the Government. |
Key Cases Cited
- Teva Pharm. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831 (2015) (claim construction: legal questions reviewed de novo; subsidiary factual findings reviewed for clear error)
- Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (claims read in context of specification; specification is primary guide)
- Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120 (2014) (definiteness requires reasonably certain scope for those skilled in the art)
- Interval Licensing LLC v. AOL, Inc., 766 F.3d 1364 (Fed. Cir. 2014) (terms of degree require objective boundaries to avoid indefiniteness)
- Lucent Technologies, Inc. v. Gateway, Inc., 525 F.3d 1200 (Fed. Cir. 2008) ("including/comprising" permits additional elements but does not nullify structural limitations)
- Lemelson v. United States, 752 F.2d 1538 (Fed. Cir. 1985) (in § 1498 suits each claim element is material; infringement requires every claim element or its substantial equivalent)
- H. Landau & Co. v. United States, 886 F.2d 322 (Fed. Cir. 1989) (government agent binds U.S. only with actual authority; implied authority exists when integral to duties)