In a newly issued Opinion, the Federal Circuit has affirmed its long-standing practice of reviewing trial court claim construction rulings de novo, as a question of law, while issues of fact will continue to receive deference by the reviewing appeals court.
Under U.S. law generally, questions of law are reviewed anew (de novo, or without deference to the trial court) by an appellate court. On questions of fact, however, trial courts do receive deference by the reviewing appeals court. The question arises, then, what to do with an issue that is both. As the Supreme Court has found, determining the meaning of a patent claim term is a "mongrel practice" of law and fact with "evidentiary underpinnings." In a much-anticipated decision handed down on Friday, the Federal Circuit held, six-to-four, that it will continue to review claim construction rulings by trial courts anew, as a question of law. Lighting Ballast Control LLC v. Philips Electronics North America Corp., Fed. Cir., No 2012-2014, 2/21/2014.
The patent bar had been awaiting the Lighting Ballast Control decision since the Court took the case in March 2013. The question presented was whether the Court would continue to adhere to the current review standard set out for claim construction in its decision in Cybor Corp. v. FAS Technologies, Inc., 138 F.3d 1448 (Fed. Cir. 1998).
Judge Newman, writing for the majority, noted that this fresh review was necessary to ensure "national uniformity, consistency, and finality to the meaning and scope of patent claims." The majority rejected arguments that Cybor has led to a high reversal rate that discourages settlement. The majority also noted that the data on post-Cybor reversal rates were at least seven years old. Judge Newman stated that many friend of the Court briefs filed with the Court favored retaining the Cybor rule. Specifically, Judge Newman stated that among the technology companies that filed amicus briefs, all favored retaining Cybor. In her view, these opinions by the technology community tend to negate the view that fresh review of claim construction increases litigation costs and discourages settlement. Absent a compelling reason to overturn precedent, the majority held that the doctrine of stare decisis requires continued adherence to Cybor. Judge Newman's opinion was joined by Judges Lourie, Dyk, Moore, and Taranto.
In his concurring opinion, Judge Lourie observed that appellate courts do informally defer to trial court claim constructions. Where the Federal Circuit disagrees with the construction of a patent claim based on the documents reflecting patent prosecution and specification history, however, he noted that the trial court's claim construction is not properly entitled to any deference.
Writing for the dissent, Judge O'Malley (joined by Chief Judge Rader and Judges Reyna and Wallach) suggested that the Supreme Court ruled in Markman II that claim construction is for the judge rather than the jury. It did not rule, according to the dissent, on the distinct issue of whether questions of law are treated separately from questions of fact during review by an appeals court. Judge O'Malley reasoned that the Federal Circuit, in Cybor, erroneously confused the two issues. Accordingly, the dissent found that the Markman II holding ought not supersede the requirement of deference for determinations of fact (including those mixed with law) made by trial judges in construing patent claims. The dissent further noted that the fresh review of claim construction decisions has needlessly increased the expense and uncertainty of patent litigation, despite the majority's opinion to the contrary.
Given the strong opinions and the attention that this question has raised, it seems likely that the parties will try to raise the issue with the Supreme Court.
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