from the United States District Court for the Northern
District of California in Nos. 3:11-cv-00774-VC,
5:11-cv-01649-PSG, Judge Vince Chhabria.
E. Jackson, Keker, Van Nest & Peters LLP, San Francisco,
CA, argued for plaintiffs-appellees. Also represented by
Ashok Ramani, Davis Polk & Wardwell LLP, Menlo Park, CA.
Stanley Martin Gibson, Jeffer Mangels Butler & Mitchell,
Los Angeles, CA, argued for defendants-appellants. Also
represented by Jessica Pauline Gans Newman, Andrew I.
Shadoff; Gregory S. Cordrey, Irvine, CA.
Prost, Chief Judge, Dyk and Wallach, Circuit Judges.
a jury trial finding Sealant Systems International and ITW
Global Tire Repair (collectively, "SSI") liable to
TEK Corporation and TEK Global, S.R.L. (collectively,
"TEK") for infringement of U.S. Patent No. 7, 789,
110 ("the '110 patent"), SSI appeals several
pre- and post-judgment orders from the United States District
Court for the Northern District of California. Specifically,
SSI appeals the district court's claim construction order
and its orders denying SSI's motions for a new trial and
judgment as a matter of law ("JMOL") on invalidity,
non-infringement, and damages. SSI also challenges the
district court's permanent injunction.
the district court improperly restricted SSI's efforts to
present the jury with relevant evidence of invalidity, we
vacate the court's final judgment as to validity and
reverse its denial of SSI's motion for partial new trial
on validity. In the interest of judicial economy, we also
reach the remaining issues on appeal. We affirm on those
issues in the event the '110 patent is found not invalid
following the new trial.
an original equipment manufacturer ("OEM"): a
manufacturer who resells another company's products under
its own name and branding. TEK sells tire repair kits to
various OEMs and owns the '110 patent. The '110
patent is directed to an emergency kit for repairing vehicle
tires deflated by puncture. '110 patent col. 1 ll. 41-50.
When TEK filed the '110 patent, a common way to handle a
flat tire was to simply replace it with a spare tire. Housing
spare tires outside or inside vehicles, however, poses
several well-known problems, such as reducing available space
in the vehicle, increasing the weight of the vehicle,
heightening exposure to tire theft, and compounding the sheer
difficulty of changing the tire. Id. at col. 1 ll.
21-43. Because the repair kit disclosed in the '110
patent comprises a small compressor and a container of
sealing liquid to mend the hole, it is intended to serve as a
smaller, lighter, and less complicated alternative to
conventional spare tires. Id. at col. 1 ll. 36-40.
November 2010, TEK sued SSI for infringing claims 26, 28, and
31 of the '110 patent. Only claim 26 is independent:
26. A kit for inflating and repairing inflatable articles;
the kit comprising a compressor assembly, a container of
sealing liquid, and conduits connecting the container to the
compressor assembly and to an inflatable article for repair
or inflation, said kit further comprising an outer casing
housing said compressor assembly and defining a seat for the
container of sealing liquid, said container being housed
removably in said seat, and additionally comprising a
container connecting conduit connecting said container to
said compressor assembly, so that the container, when housed
in said seat, is maintained functionally connected to said
compressor assembly, said kit further comprising an
additional hose cooperating with said inflatable article; and
a three-way valve input connected to said compressor
assembly, and output connected to said container and to said
additional hose to direct a stream of compressed air
selectively to said container or to said additional hose.
'110 patent, claim 26.
claim construction proceedings, SSI argued before the
magistrate judge that certain terms in claim 26-
"conduits connecting the container" and
"container connecting conduit"-should be construed
as means-plus- function limitations under 35 U.S.C. §
112, ¶ 6 because the term "conduit" is a nonce
word. In August 2012, the magistrate judge rejected that
contention and entered an order construing these terms as
"hoses and associated fittings connecting the container
to the compressor assembly and to an inflatable article for
repair or inflation" and "a hose and associated
fittings for connecting the container to the compressor
assembly," and respectively. J.A. 57-58.
claim construction, SSI moved for summary judgment of
invalidity, arguing that claim 26 was obvious over U.S.
Patent Application No. 2003/0056851 ("Eriksen") in
view of Japanese Patent No. 2004-338158
("Bridge-stone"). The district court granted
SSI's motion in March 2014. See SSI Sys. Int'l,
Inc. v. TEK Global, S.R.L., 929 F.Supp.2d 971, 974 (N.D.
Cal. 2013) ("SSI I"). In its order, the
district court determined that the term "additional hose
cooperating with said inflatable article" did not
require a direct connection between the additional hose and
the inflatable article. Id. at 978. The court
further determined that Bridgestone discloses an air tube
(54) that works together with a tire, even though it is not
directly connected to the tire, and that air tube (54)
therefore represents the element of an additional hose (83)
cooperating with the tire. Id.
appealed the district court's order to this court. On
appeal, we reversed the district court's construction of
the "cooperating with" limitation and its
subsequent invalidity determination. Sealant Sys.
Int'l, Inc. v. TEK Global, S.R.L., 616 Fed.Appx.
987, 993 (Fed. Cir. 2015) ("SSI II"). We
determined that "cooperating with," in the context
of the '110 patent, required a direct connection between
the additional hose and the inflatable article. Id.
Accordingly, we explained that "[u]nder the proper
construction of 'cooperating with,' . . . Bridgestone
does not disclose an 'additional hose cooperating
with' the tire because air tube 54 is not directly
connected to the tire." Id. at 995. Thereafter,
we reached the following conclusions: (1) "[N]either
Bridgestone nor Eriksen teach[es] the use of 'an
additional hose . . . cooperating with' the tire,"
id. at 996; (2) "Based on its erroneous
interpretation of claim scope, the district court erred in
determining that [SSI] . . . demonstrated by clear and
convincing evidence that a [POSITA] would have had reason to
combine the teachings of Eriksen and Bridge-stone to achieve
the claimed invention," id. at 995-96 (internal
quotation marks, brackets, and emphasis omitted); and (3)
"In light of these differences, the district court
clearly erred in finding Bridgestone disclosed the element of
an 'additional hose . . . cooperating with' the
tire," id. at 995.
court then remanded the case back to the district court,
explaining that because SSI "has not had an opportunity
to make a case for invalidity in light of this court's
claim construction," a "remand is therefore
required." Id. at 996. On remand, SSI again
moved for summary judgment of invalidity, J.A. 84, contending
that "it would have been obvious . . . to modify
Bridgestone to eliminate the second three-way valve (60) and
joint hose (66), resulting in a conventional tire repair kit
meeting the limitations of the claims of the 110
Patent," Appellants' Br. 10-11. At the summary
judgment hearing, the magistrate judge struggled to interpret
this court's holding in SSI II:
So this is a challenge I have, or trouble I have reading the
Federal Circuit's opinion. On the one hand they say
there's only a single issue here, which is, do either of
these references teach an additional hose cooperating with
the tire. They held, under their construction, which by
definition is the proper construction, that neither reference
teaches that particular limitation. They then go on in the
next paragraph to say, but you can try again, defendants, on
remand. So what space or gap is left between those, if
J.A. 4047-48. The magistrate judge also grappled with this
court's remand directive:
[O]n remand . . . the Federal Circuit was giving defendants
another shot with other references, but as to Bridgestone and
Eriksen, there's no gap there, right? They've
essentially foreclosed this. Whether they intended to or not,
I have to apply what they wrote, don't I?
2016, following the hearing, the magistrate judge denied
SSI's motion, noting that "the Federal Circuit has
already considered and rejected obviousness in light of the
combination of Eriksen and Bridgestone," J.A. 159, and
that "[i]t said, without qualification and after
specifically considering the same sections that Defendants
point to now, that 'neither Bridgestone nor Eriksen
teach[es] the use of an additional hose . . . cooperating
with the tire, '" J.A. 160.
district court held a four-day trial in March 2017. The jury
ultimately found claims 26, 28, and 31 of the '110 patent
infringed and not invalid. J.A. 2040-42. TEK presented both
lost profits and reasonable royalty damages theories. The
jury awarded $2, 525, 482 in lost profits and $255, 388 in
the form of a reasonable royalty for infringing sales for
which TEK did not prove its entitlement to lost profits. J.A.
trial, SSI moved for a new trial on damages (or remittitur)
and for JMOL on damages, invalidity, and noninfringement. The
district court denied SSI's motions for a new trial and
for JMOL on invalidity and noninfringement. J.A. 4-5. As to
SSI's motion for JMOL on damages, the district court
denied the motion with respect to lost profits and granted it
with respect to reasonable royalty. J.A. 5-6. The district
court also granted TEK's motion for a permanent
injunction. J.A. 8-9.
timely appealed to this court. J.A. 3775. We have
jurisdiction under 28 U.S.C. § 1295(a)(1).
I. Standards of Review
of post-trial motions for JMOL and new trial are not unique
to patent law; thus, we review them under regional circuit
law-here, the Ninth Circuit. See Wordtech Sys., Inc. v.
Integrated Networks Sols., Inc., 609 F.3d 1308, 1312
(Fed. Cir. 2010). The Ninth Circuit reviews an order denying
JMOL de novo. Wechsler v. Macke Int'l Trade,
Inc., 486 F.3d 1286, 1290 (Fed. Cir. 2007) (applying
Ninth Circuit law). The district court's JMOL
determination therefore must be affirmed if substantial
evidence supports the jury's verdict. See Revolution
Eyewear, Inc. v. Aspex Eyewear, Inc., 563 F.3d 1358,
1370 (Fed. Cir. 2009) (applying Ninth Circuit law).
"Substantial evidence is relevant evidence reasonable
minds might accept as adequate to support the jury's
conclusion, even if it is also possible to draw a contrary
Ninth Circuit reviews an order denying a new trial for abuse
of discretion. The denial is irreversible unless the record
contains no evidence in support of the verdict or the
district court committed legal error. Molski v. M.J.
Cable, Inc., 481 F.3d 724, 729 (9th Cir. 2007).
Likewise, we review the district court's ultimate
decision to grant an injunction and its conclusion on each
eBay factor for abuse of discretion. eBay Inc.
v. MercExchange, L.L.C., 547 U.S. 388, 391 (2006)
(describing equitable requirements for injunctive relief);
i4i Ltd. P'ship v. Microsoft Corp., 598 F.3d
831, 861 (Fed. Cir. 2010). But factual findings made in
support of the injunction are reviewed for clear error.
Acumed LLC v. Stryker Corp., 551 F.3d 1323, 1327
(Fed. Cir. 2008).
apply Federal Circuit case law when reviewing issues of
patent law. Ericsson, Inc. v. D-Link Sys., Inc., 773
F.3d 1201, 1214 (Fed. Cir. 2014). Claim construction is an
issue of law reviewed de novo. Williamson v. Citrix
Online, LLC, 792 F.3d 1339, 1346 (Fed. Cir. 2015)
("Regarding questions of claim construction, including
whether claim language invokes 35 U.S.C. § 112, para. 6,
the district court's determinations based on evidence
intrinsic to the patent as well as its ultimate
interpretations of the patent claims are legal questions that
we review de novo."). Infringement is an issue of fact
reviewed for substantial evidence. Braun Inc. v. Dynamics
Corp. of Am., 975 F.2d 815, 819 (Fed. Cir. 1992)
(explaining that "the jury's finding of infringement
must be upheld if it is supported by substantial
argues that TEK is not entitled to relief because the claims
are invalid. Medtronic, Inc. v. Cardiac Pacemakers,
Inc., 721 F.2d 1563, 1583 (Fed. Cir. 1983) ("[A]n
invalid claim cannot give rise to liability for infringement
. . . ."). Specifically, SSI avers that had the district
court allowed it to present to the jury its obviousness
theory based on Eriksen in view of Bridgestone, the jury
would have found the asserted claims invalid.
previously mentioned, the district court determined that,
based on our decision in SSI II, Bridgestone and
Eriksen do not disclose an additional hose cooperating with
the inflatable article. Consequently, the district court
instructed the jury that it was "not permitted to
conclude that Bridgestone or Eriksen, alone or in ...