Justia U.S. Federal Circuit Court of Appeals Opinion Summaries

The American Recovery and Reinvestment Act of 2009 provides a cash grant to entities that “place[] in service” certain renewable energy facilities. The amount is determined using the basis of the tangible personal property of the facility. Alta placed windfarm facilities into service and sought $703 million in grants. The government awarded $495 million. Alta filed suit, seeking an additional $206 million. The government counterclaimed, asserting that it had overpaid $59 million. The difference was attributable to the calculation of basis. The portion of the purchase prices attributable to grant-ineligible tangible property (real estate, transmission equipment, and buildings) must be deducted: Alta argued that the entire remainder can be allocated to grant-eligible tangible personal property, with none allocated to intangibles. The Claims Court found in favor of Alta, rejecting the government’s argument that basis must be calculated using the residual method of 26 U.S.C. 1060, which applies to the acquisition of a business. The court reasoned that no intangible goodwill or going concern value could have attached to the windfarms at the time of the transaction.The Federal Circuit vacated. The Alta purchase prices were well in excess of their development and construction costs (book value), and the transactions involved numerous related agreements, such as the leasebacks and grant-related indemnities. Goodwill and going concern value could have attached, so those assets constitute a “trade or business” within the meaning of section 1060; the transactions count as “applicable asset acquisitions.” View "Alta Wind v. United States" on Justia Law

The 2001 patent application, directed to a method of treating cancer by administering natural killer cells, was rejected on obviousness grounds, after years of examination. The Patent and Trial Appeal Board affirmed. The assignee of the application appealed to the district court under 35 U.S.C. 145, in lieu of an immediate appeal to the Federal Circuit. The statute provides that the applicant must pay “[a]ll of the expenses of the proceeding,” “regardless of the outcome.” After prevailing in the district court, the Patent and Trademark Office (USPTO) sought to recover $111,696.39 in fees under section 145. Although the district court granted the USPTO’s expert fees, it denied attorneys’ fees. Initially, the Federal Circuit reversed. On reconsideration, the court affirmed. The American Rule prohibits courts from shifting attorneys’ fees from one party to another absent a “specific and explicit” directive from Congress. The phrase “[a]ll the expenses of the proceedings” falls short of that stringent standard. View "Nantkwest, Inc. v. Iancu" on Justia Law

Nash has been in the water recreational device industry for more than 50 years and designs and manufactures water skis, kneeboards, wakeboards, and similar recreational devices. ZUP entered the market in 2012 with its “ZUP Board,” designed to assist riders who have difficulty pulling themselves up out of the water into a standing position while being towed behind a motorboat. ZUP owns the 681 patent, which includes 12 claims that generally cover a water recreational board and a method of riding that board in which a rider simultaneously uses side-by-side handles and side-by-side foot bindings to help maneuver between various riding positions to allow the rider to more readily move from lying prone, to kneeling, to crouching, to standing. The district court invalidated claims 1 and 9 as obvious and, in the alternative, held that Nash does not infringe claim 9. The Federal Circuit affirmed that claims 1 and 9 are invalid as obvious, 35 U.S.C. 103(a), and did not reach the infringement question. One of ordinary skill in the art would have been motivated to combine the various elements from prior art references, “to aid in rider stability, to allow a wide variety of users to enjoy the device, and to aid users in maneuvering between positions”—all motivations that were “a driving force throughout the prior art." View "ZUP, LLC v. Nash Manufacturing, Inc." on Justia Law

Light-emitting diodes (LEDs) are semiconductor devices that emit light when an electric current is applied. They provide illumination in products such as printers, phones, and televisions. LEDs typically consist of a substrate, an n-type semiconductor layer, and a p-type semiconductor layer. Gallium nitride (GaN) is a semiconductor that emits blue light in LEDs. Fabricating monocrystalline GaN films is difficult because of the lack of available substrates with a matching lattice structure. BU’s 738 patent relates to the preparation of monocrystalline GaN films via molecular beam epitaxy, which addresses the GaN lattice-mismatch problem with a two-step growth process. A jury found that defendants infringed the patent and failed to prove its invalidity. The district court rejected defendants’ argument that the patent is invalid for not meeting the enablement requirement, 35 U.S.C. 112. The Federal Circuit reversed, finding the asserted claim not enabled as a matter of law. The patent’s specification does not teach one of skill in the art how to make the claimed semiconductor device with a monocrystalline growth layer grown directly on an amorphous buffer layer. Defendants’ expert testified that it is impossible to epitaxially grow a monocrystalline film directly on an amorphous structure; the specification does not enable what the experts agree is physically impossible. View "Trustees of Boston University v. Everlight Electronics Co." on Justia Law

The Patent Trial and Appeal Board instituted inter partes review (IPR) over AIT’s objection that the RPX's IPR petitions were time-barred under 35 U.S.C. 315(b) because RPX was acting as a “proxy” for its client, Salesforce, on whom AIT had served a complaint alleging infringement of the patents more than one year before RPX filed its petitions. AIT alleged that RPX that the time bar applicable to Salesforce was applicable to RPX. The Board held certain claims of the patents unpatentable under 35 U.S.C. 103. The Federal Circuit vacated, concluding that the Board applied an unduly restrictive test for determining whether a person or entity is a “real party in interest” under section 315(b) and failed to consider the entirety of the evidentiary record. The term “real party in interest” has an expansive common-law meaning. RPX, unlike a traditional trade association, is a for-profit company whose clients pay for its portfolio of “patent risk solutions” to help extricate themselves from non-practicing entity lawsuits. Its SEC filings reveal one of its “strategies” is “the facilitation of challenges to patent validity,” to “reduce expenses.” The Board did not consider these facts, which, taken together, imply that RPX files IPRs to serve its clients and that a key reason clients pay RPX is to benefit from this practice if they are sued. View "Applications in Internet Time, LLC v. RPX Corp." on Justia Law

Horvath has been a Secret Service special agent since 2010. To compensate for his availability and overtime hours, Horvath receives a 25% enhancement to his base salary, Law Enforcement Availability Pay (LEAP), 5 U.S.C. 5545a(h)(1). Horvath is additionally entitled to overtime compensation for some––but not all––of the overtime hours he works. For scheduled overtime, employees receiving LEAP are compensated for work in excess of 10 hours on a day during such investigator’s basic 40-hour workweek; or on a day outside such investigator’s basic 40-hour workweek. All other overtime––scheduled or unscheduled––is considered to be compensated by LEAP rather than by additional hourly wages. There is an exception for performing certain duties, including the protective services, for which employees are compensated for all scheduled overtime. Office of Personnel Management (OPM) regulations add: the exception applies only if “[t]he investigator performs on that same day at least 2 consecutive hours of overtime work that are not scheduled in advance of the administrative workweek and are compensated by availability pay,” 5 C.F.R. 550.111(f)(2)(ii). Horvath sued, seeking back pay. Horvath asserted that the OPM regulations improperly required that certain overtime hours be worked consecutively in order to trigger compensation. The Claims Court found that it lacked jurisdiction to consider some claims and that others failed to state a claim. The Federal Circuit reversed in part, finding that the challenged regulations are contrary to the unambiguous meaning of the statute, but otherwise affirmed. View "Horvath v. United States" on Justia Law

Allergan’s Restasis Patents relate to a treatment for alleviating the symptoms of chronic dry eye. In 2015, Allergan sued, alleging infringement of the Restasis Patents based on Mylan’s filings of Abbreviated New Drug Applications. Mylan, Teva, and Akorn sought inter partes review of the patents. The Patent Board instituted IPR and scheduled a consolidated oral hearing. Before the hearing, Allergan and the Tribe entered into an agreement Mylan alleges was intended to protect the patents from review. A patent assignment transferring the Restasis patents from Allergan to the Tribe was recorded with the Patent Office. The Tribe moved to terminate the IPRs, arguing it is entitled to assert tribal sovereign immunity; Allergan moved to withdraw. The Board denied both motions. The Federal Circuit affirmed. IPR is neither clearly a judicial proceeding instituted by a private party nor clearly an enforcement action brought by the federal government: tribal sovereign immunity may not be asserted in IPR proceedings. View "Saint Regis Mohawk Tribe v. Mylan Pharmaceuticals Inc." on Justia Law

The patent describes an “attention manager [that] makes use of ‘unused capacity’” of a display device, by displaying content in that unused capacity; it can display content when the display device is turned on but the user is not actively engaged or display content in an area of the display screen not used by already-displayed content with which the user is engaged. In 2014, the Federal Circuit upheld a judgment invalidating various claims on indefiniteness grounds but remanded with respect to four claims; the court construed “attention manager” as “a system that displays images to a user either when the user is not engaged in a primary interaction or in an area of the display screen that is not used by the user’s primary activity.” On remand, the district court found that the claims fail to recite patent-eligible subject matter, 35 U.S.C. 101. The Federal Circuit affirmed. The claims are directed to an abstract idea, presentation of two sets of information, in a nonoverlapping way, on a display screen. The claimed “attention manager,” broadly construed as any “system” for producing that result, is not limited to a means of locating space on the screen and displaying the second set of information in that space. The claim limitations for accessing, scheduling, and then displaying the second information set are conventional functions stated in general terms. The claims lack any arguable technical advance over conventional computer and network technology. View "Interval Licensing, LLC v. AOL, Inc." on Justia Law

In 1942-1943, the Government contracted with the Oil Companies to purchase aviation gasoline, vital to the war effort, permitting a profit margin “between 6% and 7%.” The manufacture of avgas from crude oil uses a 98% purity sulfuric acid as a catalyst in alkylation, a process that dilutes the sulfuric acid such that it turns it into “spent alkylation acid,” which may be used to catalyze the alkylation process again following purification; produce non-avgas petroleum by-products; or be disposed of. If spent alkylation acid is used to produce other petroleum by-products, it becomes "acidic sludge," a secondary waste with a lesser percentage of acid content that can be used to manufacture fertilizer, burned, or disposed of. Unable to reprocess the increased amount of spent alkylation acid given the prioritization of production, the Companies dumped spent alkylation acid and acid sludge in California: 12 percent of the waste was spent alkylation acid, and 82.5% was acid sludge. In 1991, the Government and California sued the Companies under the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. 9601, for costs of cleaning up the disposal site. The Companies countersued. After years of litigation, the Claims Court granted the Companies partial summary judgment to prevent discovery into insurance settlements; denied the Government’s motion for leave to assert counterclaims in fraud; held that the Government was liable for clean-up costs for nonbenzol waste--$99,509,847.32, including accrued interest. The Federal Circuit affirmed, rejecting arguments that the Claims Court failed to allocate between recoverable and nonrecoverable costs, wrongfully admitted stipulations to calculate damages, and wrongly refused to allow proof of double recovery by insurance settlements. View "Shell Oil Co. v. United States" on Justia Law

Blackbird’s 747 patent is directed to energy-efficient lighting apparatuses. One embodiment discloses retrofitting an existing light fixture with a more energy efficient lighting apparatus. The district court entered a judgment of noninfringement of the patent based on its construction of “attachment surface.” The Federal Circuit vacated, holding that the district court erred in construing “attachment surface” to be secured to the ballast cover. By its plain language, claim 12 does not require the attachment surface to be secured to the ballast cover. Claim 12 expressly recites a fastening mechanism for securing the attachment surface to the illumination surface. It does not refer to any other fastening mechanism. It does not require the attachment surface be secured to anything other than the illumination surface. View "Blackbird Tech LLC v. ELB Electronics, Inc." on Justia Law