Summary Judgment – August 2014 Patent Law Updates

Summary Judgment: Amdocs (Israel) Ltd. v. Openet Telecom, Inc., 2013-1212 reverses a summary judgment of no infringement of patents directed to collecting network usage and accounting data so that users can be properly invoiced.  Although neither party had argued to the district court about whether “enhancement” in the claims occurred in a distributed fashion, the district court construed “enhance” as “to apply a number of field enhancements in a distributed fashion”. The court also clarified that “in a distributed fashion” meant that the enhancement occurred “close to the source” where the network usage information is collected. The court next construed “completing” to mean “enhance a record until all required fields have been populated.”  But because neither party argued whether enhancement occurred in a distributed fashion, the court had no briefing or argument on whether the accused products infringed under this claim interpretation. Despite this, the district court found that there were no genuine issues of material fact regarding whether the accused products “enhance” network records “in a distributed fashion.”

That pretty much portends why the CAFC reversed: while the CAFC agreed with the claim constructions, it reversed the summary judgment of no infringement because genuine issues of material fact remained unresolved.  According to the CAFC, the patentee did not need point to the specific location of the allegedly infringing code to overcome summary judgment. “We hold that Amdocs’ documentary evidence describing the structure and operation of the accused products creates genuine factual issues regarding whether the products enhance “in a distributed fashion” “close to the source” of the network information. Amdocs’ documentary evidence of infringement includes: marketing presentations and user guides describing the Framework and its operation; citations to source code present on the Installation CD; and citations to DSD scripts. The district court incorrectly concluded that marketing materials presented to foreign entities were irrelevant. While it is true that there can be no infringement of a U.S. patent for solely extra-territorial activities, this does not mean that the patentee’s description of how the Framework functions is irrelevant simply because it was presented to a foreign entity. The accused infringer admitted that the product described in these marketing materials is the same product that is made and sold in the United States.  Furthermore, a material factual issue existed as to whether the allegedly infringing code is located only on the installation CD or whether some of the code is contained in DSD scripts. For this reason the summary judgment was vacated and the case remanded.