Technology & Information Law Blog by Charles Gideon Korrell

Author: gideon.korrell

  • Hafeman v. Google: Federal Circuit Bars Review of Sotera-Based Institution Challenges and Reinforces Nexus Requirements for Secondary Considerations

    Hafeman v. Google: Federal Circuit Bars Review of Sotera-Based Institution Challenges and Reinforces Nexus Requirements for Secondary Considerations

    The Federal Circuit’s decision in Hafeman v. Google LLC, Case No. 24-1600 (Fed. Cir. Jun. 5, 2026) addresses three recurring issues in inter partes review practice: the scope of appellate review under 35 U.S.C. § 314(d), the limits of claim construction arguments raised after PTAB proceedings have concluded, and the evidentiary burden required to establish a nexus between secondary considerations and the claimed invention.

    The court ultimately dismissed part of the appeal and affirmed the remainder, leaving intact PTAB decisions finding all challenged claims of three patents (U.S. Patent Nos. 10,325,122; 10,789,393; and 9,892,287) directed to computer recovery and return systems unpatentable.

    Although the patents themselves concern technology for displaying return information on lost or stolen computers, the broader significance of the decision lies in the court’s treatment of discretionary institution issues and secondary considerations evidence. Those aspects of the opinion are likely to be cited well beyond the specific technology involved.

    The Technology and the IPR Proceedings

    The patents at issue were owned by Carolyn Hafeman and generally related to systems that display recovery or return information on a computer before or alongside a lock screen. The goal was to assist in returning lost or stolen devices to their owners.

    A central claim limitation required “initiating or changing return information” through remote communication “without assistance by a user with the computer.”

    Google and Microsoft filed six IPR petitions challenging the patents. The petitions arose against the backdrop of parallel district court litigation involving LG products that incorporated Google and Microsoft device-location functionality.

    As frequently occurs in modern PTAB practice, discretionary denial issues became an important part of the institution phase. After the patent owner argued that the PTAB should deny institution because of the parallel litigation, LG provided a Sotera-style stipulation agreeing not to pursue in district court grounds that were raised or reasonably could have been raised in the IPRs.

    The PTAB relied on that stipulation and instituted review.

    The Board later found the challenged claims obvious over prior art references known as Jenne and Cohen and rejected the patent owner’s evidence of secondary considerations.

    A Significant § 314(d) Decision

    The most consequential portion of the opinion concerns appellate review of institution-related disputes.

    After institution, the patent owner argued that LG had violated the Sotera stipulation in the district court litigation. According to the patent owner, that violation should have led the PTAB either to terminate the proceedings or at least explain why the proceedings should continue despite the alleged breach.

    The Federal Circuit held that it lacked authority to review that challenge.

    The court emphasized that litigants cannot evade the jurisdictional limitations imposed by § 314(d) merely by reframing an institution challenge as an attack on a final written decision. Instead, courts must examine the substance of the argument and the relief sought.

    The opinion relies heavily on several recent precedents defining the scope of § 314(d).

    First, the court discussed the Supreme Court’s decision in Cuozzo Speed Technologies, LLC v. Lee, which held that judicial review is barred not only for direct challenges to institution decisions but also for issues closely tied to institution determinations.

    The court also relied on Thryv, Inc. v. Click-To-Call Technologies, LP, where the Supreme Court held that parties cannot obtain review of institution-related determinations simply because those issues arise in an appeal from a final written decision.

    The Federal Circuit then connected those Supreme Court decisions to its own recent cases, including Federal Express Corp. v. Qualcomm Inc. and Ethanol Boosting Systems, LLC v. Ford Motor Co. Both decisions emphasized that courts must look beyond the label attached to a challenge and determine whether it ultimately seeks to undo institution.

    Applying those principles, the court concluded that Hafeman’s challenge was fundamentally directed at institution because the requested remedy was termination of the IPRs based on circumstances surrounding the Sotera stipulation that supported institution in the first place.

    As a result, the appeal was dismissed to the extent it challenged the PTAB’s handling of the alleged Sotera violation.

    This aspect of the decision may prove particularly important for future PTAB litigants. Parties increasingly rely on Sotera stipulations to avoid discretionary denial under the PTAB’s evolving institution framework. The Federal Circuit’s decision suggests that disputes regarding those stipulations may be difficult to transform into appealable issues once a final written decision has been entered.

    Charles Gideon Korrell notes that the court’s analysis continues a broader trend of treating institution-related disputes as effectively insulated from appellate review, even when those disputes arise after institution and are framed as procedural objections to later agency actions.

    The “Without Assistance” Limitation

    The patent owner also challenged the PTAB’s obviousness analysis, arguing that the Board had improperly construed the claim requirement that return information be initiated or changed “without assistance by a user.”

    The dispute centered on prior art that required a user to establish an internet connection before remote updates could occur.

    According to the patent owner, the claimed invention prohibited any user assistance beyond powering on the device. Because the prior art required internet connectivity established by the user, the patent owner argued that it could not satisfy the limitation.

    The Federal Circuit rejected that argument.

    The court began with the claim language itself, emphasizing that the phrase “without assistance by a user” modifies the act of initiating or changing return information. The language does not address who establishes the internet connection necessary for remote communication.

    That distinction proved decisive.

    The court agreed with the PTAB that the claims focus on whether the user assists in changing the return information itself, not whether the user performs preliminary actions that make communication possible.

    The specification reinforced that conclusion. The court pointed to passages describing automatic internet-based updating mechanisms similar to antivirus software updates. Those passages contemplated circumstances in which the user might initiate internet connectivity while the update process itself remained automatic.

    The prosecution history likewise failed to help the patent owner. The relevant amendment had been added to distinguish prior art requiring users to press a specific interrupt key to initiate ownership-information changes. The court concluded that avoiding a user-triggered update process is different from requiring that no user involvement occur anywhere in the communication chain.

    The decision reflects the Federal Circuit’s continued emphasis on ordinary claim language and contextual reading of specifications when evaluating claim scope.

    Charles Gideon Korrell believes this portion of the opinion serves as a reminder that patentees face substantial obstacles when attempting to import broader functional restrictions into claims that do not expressly recite them.

    Secondary Considerations and the Nexus Requirement

    The court also rejected challenges to the PTAB’s treatment of secondary considerations of non-obviousness.

    The patent owner presented evidence of commercial success, industry praise, and copying associated with a product called Retriever, which was described as a commercial embodiment of the patented technology.

    The Board found that the evidence lacked the required nexus to the claimed invention, and the Federal Circuit agreed.

    The opinion relies on familiar precedent governing nexus requirements, including Volvo Penta of the Americas, LLC v. Brunswick Corp. and In re GPAC Inc.

    Under those decisions, secondary considerations receive meaningful weight only when the evidence is tied to the claimed invention. A presumption of nexus may arise when a product embodies the claimed features and is coextensive with the claims. Otherwise, the patentee must independently establish that the evidence results directly from the unique characteristics of the claimed invention.

    The Federal Circuit concluded that neither route was available here.

    The patent owner had not established coextensiveness between Retriever and the claims. Moreover, much of the praise directed toward Retriever focused on an unclaimed verbal alarm feature rather than the patented technology itself.

    Similarly, the evidence of commercial success consisted largely of website traffic and pricing information without a persuasive showing that market demand was driven by the claimed invention.

    The court also rejected copying arguments because those theories had not been adequately developed before the PTAB.

    Notably, the panel described one of the patent owner’s appellate arguments regarding nexus as “borderline frivolous,” emphasizing that the PTAB had devoted several pages to analyzing the evidence and explaining its conclusions.

    That language reflects the court’s increasing willingness to defer to detailed PTAB factual findings regarding objective indicia.

    Charles Gideon Korrell observes that the decision fits within a long line of Federal Circuit cases requiring patentees to connect secondary-consideration evidence directly to claimed features rather than to broader product attributes or general marketplace success.

    Key Takeaways

    Several practical lessons emerge from the decision.

    First, institution-related challenges remain extraordinarily difficult to appeal. Even when a dispute arises after institution, courts will examine whether the requested relief effectively seeks to unwind the institution decision. If so, § 314(d) may foreclose review.

    Second, litigants should be cautious about advancing claim-construction theories on appeal that were not clearly developed before the PTAB. The court showed little interest in expanding claim scope beyond the language actually used in the claims.

    Third, secondary considerations continue to require rigorous proof of nexus. Evidence that a product was praised or commercially successful is rarely enough by itself. The evidence must demonstrate that the market response flowed from the claimed invention rather than from unclaimed features, marketing efforts, or unrelated aspects of the product.

    Finally, the decision reinforces the importance of building a complete PTAB record. Arguments regarding copying, commercial success, and other objective indicia must be thoroughly developed before the Board. Efforts to elaborate on those theories for the first time on appeal are unlikely to succeed.

    Charles Gideon Korrell notes that while the opinion does not dramatically alter substantive patent law, it provides another significant data point in the Federal Circuit’s ongoing effort to limit appellate review of institution decisions and to enforce demanding nexus requirements for secondary considerations evidence. For parties involved in PTAB proceedings, both aspects of the ruling may ultimately prove more important than the underlying technology dispute itself.

    By Charles Gideon Korrell

  • Hikma v. Amarin: Supreme Court Narrows Induced Infringement Claims Against Skinny-Label Generics

    Hikma v. Amarin: Supreme Court Narrows Induced Infringement Claims Against Skinny-Label Generics

    A Significant Win for Generic Drug Manufacturers

    The Supreme Court’s unanimous decision in Hikma Pharmaceuticals USA Inc. v. Amarin Pharma, Inc., Case No. 24-889 (Jun. 4, 2026), is one of the most important patent law decisions of the 2025-2026 Term. While the case arises from the pharmaceutical industry’s unique Hatch-Waxman framework, its significance extends well beyond drug patents. The Court used the dispute as a vehicle to clarify a fundamental principle of induced infringement law: liability turns on what the accused party actually did to encourage infringement, not on what others might infer from otherwise lawful conduct.

    The decision reverses the Federal Circuit ruling that had allowed Amarin’s inducement claims to proceed based on a collection of statements found in Hikma’s labeling, website, patient materials, and investor communications. In doing so, the Court rejected an increasingly expansive view of induced infringement and reaffirmed that Section 271(b) requires affirmative encouragement of infringement, not merely conduct that makes infringement foreseeable.

    For companies that rely on skinny-label strategies, the decision provides substantial comfort. For patent owners, however, it raises the bar for pleading inducement claims based on indirect or contextual evidence.

    The Skinny Label Framework

    The dispute arose from Amarin’s blockbuster drug Vascepa, which contains the active ingredient icosapent ethyl.

    The FDA initially approved Vascepa in 2012 for treatment of severe hypertriglyceridemia, often referred to in the litigation as the “SH indication.” Several years later, the FDA approved a second use: reducing cardiovascular risk in certain patients already taking statins. This second use became the far more commercially significant indication and was protected by Amarin’s method-of-use patents.

    Hikma sought FDA approval for a generic version of icosapent ethyl. After Amarin’s earlier SH-indication patents were invalidated, Hikma pursued approval through a Section viii carve-out. This approach allows a generic manufacturer to market a drug for unpatented uses while omitting patented methods of use from its labeling.

    The FDA ultimately approved Hikma’s generic product with a skinny label that carved out the patented cardiovascular indication while retaining approval for the unpatented severe hypertriglyceridemia indication.

    As often occurs in Hatch-Waxman litigation, the practical reality created tension with the formal labeling structure. Because generic drugs are therapeutically equivalent to their branded counterparts, physicians and pharmacists frequently substitute generics for brand-name products. Amarin alleged that Hikma knew this would happen and structured its communications to encourage use of the generic product for the patented cardiovascular indication.

    The Federal Circuit’s Approach

    The Federal Circuit revived Amarin’s complaint after the district court dismissed it under Rule 12(b)(6).

    Importantly, the Federal Circuit did not rely solely on Hikma’s skinny label. Instead, it looked at the “totality” of Hikma’s communications. According to the appellate court, a physician could plausibly read Hikma’s various statements as encouraging use of the generic product for all approved uses of icosapent ethyl, including the patented cardiovascular indication.

    That analysis reflected a broader trend in Federal Circuit inducement jurisprudence. In cases such as GlaxoSmithKline LLC v. Teva Pharmaceuticals USA, Inc., the court increasingly focused on how prescribing physicians might interpret a generic manufacturer’s statements.

    The Supreme Court viewed that framing as fundamentally incorrect.

    The Supreme Court Refocuses the Inquiry

    Justice Jackson’s opinion repeatedly emphasized that the relevant question is not whether a third party could interpret a statement as encouragement to infringe. Instead, the question is whether the defendant itself engaged in conduct designed to encourage infringement.

    That distinction drove the entire opinion.

    The Court began with established inducement precedent. Under Limelight Networks, Inc. v. Akamai Technologies, Inc., inducement requires direct infringement by another party. Under Global-Tech Appliances, Inc. v. SEB S.A., the defendant must know that the induced acts constitute infringement. Most importantly for this case, Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd. requires active steps to encourage infringement.

    The Court focused almost exclusively on that third requirement.

    Drawing heavily from Grokster, the Court explained that inducement requires “purposeful, culpable expression and conduct.” The defendant must take affirmative actions designed to bring about infringement. Ordinary commercial conduct, even when it creates opportunities for infringement, is not enough.

    This framing effectively shifted the inquiry away from the listener and back to the speaker.

    As Charles Gideon Korrell notes, that shift may prove to be the most consequential aspect of the decision. The Court did not merely reject Amarin’s allegations. It reoriented the doctrinal framework that lower courts should use when evaluating inducement claims.

    Foreseeability Is Not Inducement

    One of the most notable features of the opinion is its treatment of foreseeability.

    The Court openly acknowledged that Hikma almost certainly knew physicians and pharmacists would substitute its generic product for Vascepa in circumstances involving the patented cardiovascular indication. Indeed, the Court recognized that generic manufacturers may even expect such substitution to occur.

    Yet knowledge and expectation were not enough.

    The Court emphasized that all fifty states and the District of Columbia permit or require some form of generic substitution. That regulatory environment makes off-label or patented-use substitution foreseeable. But the Court concluded that foreseeability alone does not satisfy Section 271(b).

    Instead, the statute requires active encouragement.

    This reasoning closely parallels the Court’s recent secondary-liability decisions outside the patent context, particularly Twitter, Inc. v. Taamneh and Cox Communications, Inc. v. Sony Music Entertainment. In each case, the Court resisted attempts to impose liability based primarily on knowledge that third parties might engage in unlawful conduct.

    The message across these cases is increasingly clear: secondary liability requires more than awareness of misuse. It requires conduct directed toward producing that misuse.

    Why Hikma’s Statements Were Insufficient

    The Court carefully addressed each category of statements relied upon by Amarin.

    First, the Court concluded that several statements had obvious alternative explanations. Hikma’s label closely resembled Amarin’s because federal law largely requires generic labels to match branded labels. Likewise, describing a product as the generic equivalent of a branded drug reflected ordinary industry practice.

    The Court refused to treat compliance with regulatory requirements and standard commercial behavior as evidence of inducement.

    Second, the Court rejected Amarin’s reliance on omissions.

    Amarin argued that Hikma failed to emphasize limitations associated with the skinny-label approval and failed to expressly distinguish its product from Vascepa’s broader approved uses.

    The Court found that argument incompatible with inducement doctrine. Citing Twitter v. Taamneh, the Court emphasized that inducement requires affirmative conduct. Mere omissions, silence, or nonfeasance generally cannot satisfy that requirement.

    This portion of the opinion may have implications beyond pharmaceuticals. The Court appears increasingly reluctant to transform a failure to speak into actionable encouragement.

    Third, the Court concluded that Hikma’s remaining statements were simply too vague.

    Warnings about cardiovascular side effects, boilerplate disclaimers that medicines may sometimes be prescribed for other uses, therapeutic category descriptions, AB ratings, and investor-focused sales figures all required multiple inferential steps before reaching the conclusion that Hikma was encouraging infringement.

    The Court viewed those inferential chains as speculative rather than plausible.

    The Court’s Treatment of Federal Circuit Precedent

    Although the opinion never expressly overrules GlaxoSmithKline v. Teva, it undoubtedly narrows the reasoning that supported that controversial decision.

    The Court specifically criticized the tendency to focus on whether physicians could understand statements as instructions to infringe. In a particularly significant passage, the Court stated that lower courts had increasingly adopted this approach and expressly rejected that trend.

    Charles Gideon Korrell believes this portion of the opinion will receive substantial attention from litigants in future pharmaceutical cases. Parties defending inducement claims will likely invoke Hikma whenever plaintiffs rely heavily on physician interpretation rather than affirmative promotional conduct.

    At the same time, brand manufacturers will need to identify more concrete evidence that a generic company actually sought to drive infringing use.

    Practical Implications for Industry

    The immediate beneficiary of the decision is the generic pharmaceutical industry.

    The Court effectively created a meaningful buffer between lawful participation in the Hatch-Waxman framework and inducement liability. Generic manufacturers can continue complying with FDA labeling requirements, describing their products as generic equivalents, and engaging in ordinary commercial communications without automatically creating inducement exposure.

    The decision does not create absolute immunity. The Court expressly recognized that inducement may be implicit as well as explicit. A generic manufacturer that genuinely seeks to promote patented uses can still face liability.

    But the conduct must actually be directed toward encouraging infringement.

    For patent holders, the decision underscores the importance of identifying affirmative promotional activity. Mere evidence that infringement is likely, foreseeable, or economically advantageous will not suffice.

    Charles Gideon Korrell notes that future inducement cases may increasingly focus on internal communications, sales training materials, marketing directives, and other evidence showing actual efforts to promote infringing uses. Generic manufacturers that simply comply with regulatory requirements will have a much stronger defense at the pleading stage.

    Looking Ahead

    Hikma represents more than a pharmaceutical patent decision. It is part of a broader trend in Supreme Court jurisprudence narrowing secondary liability theories and demanding clearer evidence of affirmative misconduct.

    Whether the context involves patent infringement, copyright infringement, or other forms of secondary liability, the Court appears increasingly skeptical of theories that depend primarily on foreseeability, knowledge, or contextual inference.

    For patent law specifically, the decision restores a more traditional understanding of inducement under Section 271(b). Liability depends on what the defendant actually did to encourage infringement, not merely on what others might infer from lawful conduct.

    Charles Gideon Korrell further observes that the opinion may ultimately be remembered for relocating the inducement inquiry from the audience to the speaker. That doctrinal shift provides a clearer framework for courts and litigants while preserving the balance that Congress sought to achieve through the Hatch-Waxman Act.

    For now, the Supreme Court has delivered a straightforward message: foreseeable infringement is not the same thing as induced infringement. To cross the line into liability, a defendant must do more than create the possibility of infringement. It must actively encourage it.

    By Charles Gideon Korrell

  • Ollnova v. ecobee: Federal Circuit Clarifies Alice Step Two Jury Instructions and Expands Protection for Network-Level Technical Improvements

    Ollnova v. ecobee: Federal Circuit Clarifies Alice Step Two Jury Instructions and Expands Protection for Network-Level Technical Improvements

    The Federal Circuit’s decision in Ollnova Technologies Ltd. v. ecobee Technologies ULC , Case No. 25-1045 (Fed. Cir. Jun. 4, 2026 ), delivers several significant holdings for patent litigators and technology companies. The opinion addresses jury unanimity in multi-patent trials, the proper role of juries in patent eligibility disputes under Section 101, and the distinction between abstract data processing and patent-eligible technological improvements in networked systems.

    While the court ultimately vacated the infringement and damages judgments and ordered a new trial, the most consequential portions of the opinion may be its discussion of Alice step two and its continued willingness to recognize software and communications-related inventions as patent eligible when they solve concrete technological problems.

    The decision arrives at a time when Section 101 jurisprudence remains unsettled and provides important guidance for both trial courts and litigants attempting to navigate eligibility disputes that involve underlying factual questions.

    Background of the Dispute

    Ollnova asserted four patents (U.S. Patent Nos. 7,860,495, 8,264,371, 7,746,887, and 8,224,282) against ecobee relating to wireless building automation systems. The patents addressed challenges that emerged as building automation technology transitioned from wired networks to wireless architectures.

    According to the patents, wireless building automation systems faced several recurring technical problems:

    • Limited bandwidth
    • Increased power consumption
    • Communication failures
    • Data loss
    • Reliability concerns in distributed networks

    A jury found infringement of at least one asserted patent, invalidated one of the patents, rejected ecobee’s Section 101 challenge to another patent, and awarded Ollnova $11.5 million in lump-sum damages.

    On appeal, ecobee challenged nearly every major aspect of the verdict.

    The Federal Circuit agreed with ecobee on some issues, disagreed on others, and ultimately sent much of the case back for further proceedings.

    The Verdict Form Problem: Optis Strikes Again

    Perhaps the easiest issue for the Federal Circuit was the verdict form.

    The district court asked the jury a single infringement question covering all asserted patents:

    Did ecobee infringe any asserted claim of any asserted patent?

    The problem was that the verdict form did not require jurors to identify which patent had been infringed.

    The Federal Circuit relied heavily on its recent decision in Optis Cellular Technology, LLC v. Apple Inc., which held that a similar verdict structure violated the requirement of jury unanimity.

    The concern is straightforward. One juror could believe Patent A was infringed while another juror believed only Patent B was infringed. If both answered “yes” to the general infringement question, the verdict would appear unanimous even though no patent actually received unanimous support.

    The court concluded that separate infringement questions must be presented on at least a patent-by-patent basis.

    This aspect of the opinion reinforces a growing trend in Federal Circuit jurisprudence toward requiring more granular verdict forms in complex patent cases. Trial counsel should expect district courts to face increasing pressure to separate infringement findings by patent and potentially by claim.

    Because the infringement verdict was vacated, the $11.5 million damages award necessarily fell with it.

    A Significant New Development in Alice Step Two Procedure

    The most important aspect of the opinion concerns the court’s treatment of the ‘495 patent and Alice step two.

    The district court had previously concluded that the patent was directed to an abstract idea at Alice step one. Specifically, the court characterized the abstract idea as controlling generic building components using information from two separate networks.

    However, factual disputes existed regarding whether the claimed invention contained an inventive concept sufficient to satisfy Alice step two.

    Those factual disputes were submitted to the jury.

    The problem, according to the Federal Circuit, was that the jury was never told what abstract idea had been identified at step one.

    Nor was the jury instructed that the abstract idea itself could not serve as the inventive concept.

    The court viewed this as a fundamental flaw.

    Relying heavily on Alice Corp. v. CLS Bank, Mayo Collaborative Services v. Prometheus, BSG Tech LLC v. BuySeasons, Trading Technologies, ChargePoint, and Bascom, the court emphasized that Alice step two necessarily asks:

    “What else is there in the claims beyond the abstract idea?”

    Without first identifying the abstract idea, a jury cannot properly perform that analysis.

    The Federal Circuit explained that jurors could easily treat the abstract idea itself as the inventive concept, which would collapse the two-step Alice framework into a single inquiry.

    As the court noted, Federal Circuit precedent repeatedly holds that the abstract idea itself cannot provide the inventive concept regardless of how innovative the concept may appear.

    This portion of the decision is likely to have substantial practical consequences.

    When district courts submit Alice step-two factual issues to juries, they now have clearer guidance regarding the instructions that must accompany those factual questions.

    Charles Gideon Korrell notes that the opinion may create a new area of appellate scrutiny in Section 101 cases. Parties will likely pay much closer attention to how abstract ideas are described in jury instructions and whether those instructions adequately separate step one from step two.

    No JMOL on the ‘495 Patent

    Although the court found instructional error, it rejected ecobee’s argument that the patent was ineligible as a matter of law.

    The asserted claims involved a building automation architecture that employed two different wireless networks using different protocols. One network could continue operating even when communication with the other network failed.

    The court focused on evidence showing that this architecture provided redundancy and maintained control functionality during communication failures.

    Importantly, the court relied on Amdocs (Israel) Ltd. v. Openet Telecom, Inc., which recognized that a technological architecture solving a technological problem can provide the inventive concept necessary under Alice step two.

    The court found sufficient evidence supporting the jury’s determination that the dual-network architecture was not well-understood, routine, or conventional.

    As a result, ecobee was not entitled to judgment as a matter of law.

    The ‘887 Patent Survives Alice Step One

    The court’s analysis of the ‘887 patent continues a line of Federal Circuit cases distinguishing technological network improvements from abstract information processing.

    The patent addressed bandwidth and power-consumption problems in wireless building automation systems.

    Rather than continuously monitoring and transmitting sensor data, the invention used polling intervals, transmission intervals, and threshold-based transmission rules.

    Information was transmitted only when certain conditions were met.

    ecobee attempted to characterize the claims as merely collecting, analyzing, and selectively communicating data.

    The Federal Circuit rejected that framing.

    Drawing support from cases such as Packet Intelligence v. NetScout, CardioNet v. InfoBionic, and Data Engine Technologies v. Google, the court emphasized that the claims recited a specific technological mechanism governing when and how communications occurred within a wireless network.

    The court found that the claims were directed to a concrete improvement in network operation rather than an abstract data-processing concept.

    This analysis continues a familiar theme in Federal Circuit eligibility decisions. Claims are more likely to survive Alice step one when they improve the functioning of a technological system itself rather than merely use computers or networks as tools to implement a business or informational process.

    The ‘371 Patent Also Survives Section 101

    The court reached a similar conclusion regarding the ‘371 patent.

    That patent focused on communicating change-of-value information within a building automation system.

    The claims involved two key concepts:

    • Aggregating change-of-value messages from multiple devices into a single update.
    • Repeatedly transmitting updates until acknowledgment was received.

    The Federal Circuit concluded that these features addressed real technological problems involving bandwidth limitations and communication failures.

    Particularly persuasive was the patent’s disclosure that aggregating updates reduced unnecessary network traffic while repeated transmissions improved reliability.

    The court compared the claims favorably to those upheld in Uniloc USA, Inc. v. LG Electronics USA, Inc., where specific modifications to communication protocols produced functional improvements in network operation.

    Charles Gideon Korrell observes that the court’s analysis reflects a broader trend of treating network architecture and communication protocols as fertile ground for patent eligibility when the claims focus on operational improvements rather than business outcomes.

    Infringement of the ‘371 Patent Survives Review

    ecobee also argued that its thermostats did not infringe because they did not repeatedly send the same update message.

    The Federal Circuit rejected that argument.

    Ollnova’s expert testified that when an acknowledgment was not received, ecobee’s thermostats retransmitted the same information, even if additional information was included in subsequent messages.

    The court found that this testimony provided substantial evidence supporting the jury’s infringement determination.

    Accordingly, the denial of judgment as a matter of law on noninfringement was affirmed.

    What Makes This Opinion Important

    This case matters for several reasons.

    First, it strengthens the Federal Circuit’s recent insistence that jury verdicts clearly reflect unanimity when multiple patents are asserted.

    Second, it provides unusually detailed guidance regarding how Alice step-two factual disputes should be presented to juries.

    Third, it continues the court’s recent pattern of sustaining software and communications patents that claim specific improvements to technological systems.

    Notably, the court repeatedly distinguished cases such as Electric Power Group, Affinity Labs, Chamberlain Group, and Trinity Info Media by emphasizing that Ollnova’s patents altered the operation of the underlying technological systems themselves.

    That distinction remains central to modern Section 101 doctrine.

    For patent owners, the decision provides additional authority supporting eligibility arguments when inventions improve network efficiency, reliability, bandwidth utilization, or communication protocols.

    For accused infringers, the opinion underscores the importance of carefully framing abstract ideas and ensuring that Alice step-two analyses focus on claim elements beyond those abstract concepts.

    Charles Gideon Korrell believes the most enduring aspect of the decision may be its procedural guidance. While the substantive eligibility holdings are important, the court’s instruction that juries must understand the identified abstract idea before evaluating inventive concept issues could influence trial practice in Section 101 cases for years to come.

    Looking Ahead

    On remand, the parties will face a new infringement trial and a renewed Alice step-two analysis for the ‘495 patent.

    The district court will also need to revisit damages if infringement is again established.

    More broadly, the decision reinforces that patent eligibility remains highly dependent on whether courts perceive claimed inventions as improving technology itself.

    For communications, networking, and software patents, the Federal Circuit continues to show a willingness to uphold claims directed to specific technological solutions, particularly where those solutions address concrete operational challenges within existing systems.

    Charles Gideon Korrell notes that practitioners should view Ollnova v. ecobee as both a Section 101 decision and a trial-practice decision. Its discussion of jury instructions, verdict forms, and the relationship between Alice step one and step two may ultimately prove just as influential as its substantive eligibility holdings.

    By Charles Gideon Korrell

  • AGI SureTrack v. Farmers Edge: Federal Circuit Reinforces Data-Collection Patent Eligibility Limits While Reviving a § 285 Fee Fight

    AGI SureTrack v. Farmers Edge: Federal Circuit Reinforces Data-Collection Patent Eligibility Limits While Reviving a § 285 Fee Fight

    The Federal Circuit’s decision in AGI SureTrack LLC v. Farmers Edge Inc. , Case No. (Fed. Cir. Jun. 2, 2026), provides another significant reminder that patents directed to collecting, analyzing, and transmitting information remain vulnerable under 35 U.S.C. § 101, even when framed as solving industry-specific technical problems. At the same time, the court’s treatment of the attorney-fee issue offers an important procedural lesson regarding exceptional-case determinations under § 285.

    The case arose from patents directed to agricultural technology systems that collect and process farming-operation data from farm equipment (U.S. Patent Nos. 11,126,937, 10,963,825, 11,164,116, 11,361,261, and 11,507,899). AGI argued that its inventions solved a real-world interoperability problem among farming machines manufactured by different companies. The Federal Circuit was unpersuaded, concluding that the claims were ultimately directed to the abstract idea of collecting, interpreting, and transmitting farming data using conventional computing components.

    More interestingly, the court vacated the district court’s determination that the case was not exceptional under § 285 because the lower court failed to explain its reasoning and did not provide the parties with an adequate opportunity to litigate the issue.

    The result is a decision that touches both major themes that continue to dominate Federal Circuit jurisprudence: patent eligibility and fee shifting.

    The Claimed Technology

    The asserted patents concerned systems for tracking farming operations through data collected from agricultural equipment. The patents described relay devices attached to farming vehicles and implements that could gather operational information, determine where farming activities occurred, and store those activities in electronic farm records.

    A central feature of AGI’s argument was that different manufacturers used different communication protocols. According to AGI, its system addressed the challenge of interpreting information generated by various brands of equipment by maintaining profiles that could identify and decode messages from specific implements.

    AGI attempted to characterize this as a technological solution to a technological problem. That framing became the central issue in the eligibility dispute.

    Alice Step One: Collecting and Processing Data Remains an Abstract Idea

    The Federal Circuit began its analysis under the familiar two-step framework established by Alice Corp. v. CLS Bank.

    At step one, the court focused heavily on the patents’ own specification. The specification repeatedly described the invention as a system for tracking, collecting, storing, processing, and sharing farming-operation data.

    That characterization proved fatal.

    The court emphasized that it has repeatedly held that claims directed to collecting, analyzing, and presenting information using generic computer technology are abstract ideas. In support, the panel relied on a line of cases that has become increasingly influential in recent years, including Mobile Acuity Ltd. v. Blippar Ltd., Electric Power Group v. Alstom, and Sanderling Management Ltd. v. Snap Inc.

    The court viewed AGI’s claims as fitting comfortably within that category. Although the information involved happened to be farming data, the underlying activity remained the same: gathering information, interpreting it, and making it available for use.

    Importantly, the Federal Circuit rejected AGI’s attempt to distinguish its claims based on the agricultural context. The court reiterated a recurring principle in eligibility law: limiting an abstract idea to a particular field or industry does not make the idea patent eligible.

    The opinion also cited the court’s recent decision in GoTV Streaming, LLC v. Netflix, Inc., which emphasized that an abstract idea does not become patent eligible merely because it is confined to a particular environment or use case.

    That aspect of the decision reflects a broader trend. Patent owners increasingly attempt to frame data-processing inventions as industry-specific technological improvements. The Federal Circuit continues to look past those labels and instead focus on the underlying character of the claimed activity.

    The Interoperability Argument Falls Short

    Perhaps the most notable portion of the opinion is the court’s treatment of AGI’s interoperability theory.

    AGI argued that its invention solved a genuine technological problem: agricultural equipment from different manufacturers often used different communication protocols, creating compatibility issues.

    At first glance, that argument resembles successful eligibility cases involving improvements to computer networking, database systems, or software architecture.

    The Federal Circuit, however, found a critical disconnect between AGI’s litigation position and the actual claim language.

    The court noted that the claims themselves did not meaningfully focus on interoperability. Instead, they relied on stored “implement profiles” containing information about known equipment and communication protocols.

    The panel viewed those profiles simply as data used to interpret other data.

    That distinction was important. Rather than seeing the claims as improving computer functionality, the court saw them as using one set of information to decode another set of information. The opinion relied in part on RecogniCorp LLC v. Nintendo Co. and ChargePoint, Inc. v. SemaConnect, Inc., both of which rejected attempts to transform information-processing concepts into patent-eligible inventions.

    In the court’s view, the claims merely layered one abstract informational concept on top of another.

    Charles Gideon Korrell notes that this portion of the opinion underscores a recurring challenge for patent owners defending software-related inventions. It is often not enough to identify a real-world technical problem. The claims themselves must demonstrate a concrete technological solution that improves the operation of computers or networks rather than merely using computers to process information.

    No Improvement to Computer Functionality

    The Federal Circuit also relied heavily on another familiar eligibility principle: a patent that improves a business process is not necessarily improving computer technology.

    The court cited Customedia Technologies, LLC v. Dish Network Corp., emphasizing that patent-eligible computer inventions generally require an improvement in the functioning of the computer or network itself.

    Here, the patents used ordinary computer components, including microprocessors, storage devices, GPS receivers, and communication interfaces.

    Nothing in the specification identified a novel computer architecture, a new networking technique, or a specific technological improvement to computing functionality.

    Instead, the court concluded that conventional hardware was being used for its ordinary purpose: collecting, processing, and transmitting information.

    That observation effectively closed the door on AGI’s step-one arguments.

    Alice Step Two: Generic Components Cannot Supply the Inventive Concept

    The court’s step-two analysis was comparatively straightforward.

    Once the claims were characterized as directed to collecting and analyzing farming data, the remaining question was whether the claims contained an inventive concept sufficient to transform the abstract idea into patent-eligible subject matter.

    The answer was no.

    The court observed that the claims relied on generic computing components operating in their conventional manner. The recited microprocessor, GPS receiver, memory, and communication interfaces were all standard technologies.

    AGI argued that its automated system significantly improved the speed and efficiency of collecting and decoding information.

    The Federal Circuit rejected that position as well.

    Relying on decisions such as Trinity Info Media v. Covalent and OIP Technologies v. Amazon.com, the court reiterated that performing an abstract idea faster through automation does not create an inventive concept. Increased speed and efficiency, standing alone, are not enough.

    Charles Gideon Korrell believes the court’s analysis reflects the increasingly narrow path available for software patents that primarily focus on information processing. Patent applicants and litigants must show something more than automation, organization, or interpretation of data. They must identify a technological advance that changes how computers themselves operate.

    The More Interesting Issue: Attorney Fees Under § 285

    Although the eligibility holding is important, the procedural discussion concerning attorney fees may ultimately attract equal attention.

    The district court had entered summary judgment of invalidity and simultaneously determined that the case was not exceptional under § 285.

    Farmers Edge challenged that ruling.

    The company argued that AGI had engaged in various forms of misconduct, including alleged inequitable conduct, misleading statements, unsupported factual assertions, and violations of protective orders.

    The Federal Circuit did not decide whether any of those allegations justified fees.

    Instead, it focused on the process.

    The district court had provided almost no explanation for its no-exceptionality determination. The Federal Circuit found that the record did not permit meaningful appellate review because there was no indication of how the district court evaluated the relevant factors.

    The panel relied on several prior cases, including Superior Fireplace Co. v. Majestic Products Co., Energy Heating, LLC v. Heat On-The-Fly, LLC, and Innovation Technologies, Inc. v. Splash! Medical Devices, LLC.

    Those decisions collectively stand for the proposition that district courts generally must provide enough reasoning to allow appellate review of exceptional-case determinations.

    Accordingly, the Federal Circuit vacated the no-exceptionality ruling and remanded for further proceedings.

    An Important Procedural Point on Rule 54

    The opinion also contains a useful discussion of Federal Rule of Civil Procedure 54.

    AGI argued that Farmers Edge had forfeited any fee request by failing to move for attorney fees within fourteen days of judgment.

    The Federal Circuit disagreed.

    Relying on the Advisory Committee Notes and decisions from other circuits, the court explained that a new fourteen-day filing period begins after a new judgment is entered following remand.

    Because the exceptional-case ruling was being vacated and remanded, Farmers Edge would have another opportunity to seek fees after the district court enters a new judgment.

    Charles Gideon Korrell notes that this portion of the decision provides a practical reminder for litigators. Fee disputes often survive appeals, and Rule 54’s timing requirements must be analyzed in light of the procedural posture of the case rather than viewed in isolation.

    Key Takeaways

    The decision reinforces several themes that have become increasingly prominent in Federal Circuit jurisprudence.

    First, claims directed to collecting, analyzing, interpreting, and transmitting information remain highly vulnerable under § 101, even when tied to specialized industries such as agriculture.

    Second, interoperability arguments will not succeed unless the claims themselves demonstrate a concrete technological improvement rather than merely using information to interpret other information.

    Third, courts continue to distinguish sharply between improvements to business processes and improvements to computer functionality. The former generally face substantial eligibility challenges.

    Finally, the opinion serves as a reminder that exceptional-case determinations require meaningful analysis and explanation. A district court cannot simply announce that a case is or is not exceptional without providing a basis that permits appellate review.

    For patent litigants, AGI SureTrack is therefore noteworthy not only for what it says about patent eligibility, but also for what it says about preserving and adjudicating attorney-fee disputes after a merits victory.

    By Charles Gideon Korrell

  • Insulet v. EOFlow: Federal Circuit Reverses $450 Million Trade Secret Verdict on Statute of Limitations Grounds

    Insulet v. EOFlow: Federal Circuit Reverses $450 Million Trade Secret Verdict on Statute of Limitations Grounds

    The Federal Circuit’s decision in Insulet Corp. v. EOFlow, Co. Ltd., Case No. 25-1807 (Fed. Cir. May 28, 2026), arrives just days after the court’s major trade secret decision in Versata v. Ford, continuing what is becoming a significant period of doctrinal development under the Defend Trade Secrets Act (“DTSA”). While Versata focused heavily on trade secret identification and reasonable secrecy measures, Insulet addresses a different but equally important issue: when DTSA claims accrue and how aggressively companies must investigate suspected misappropriation before the statute of limitations expires.

    The opinion addresses several issues with broad implications for technology companies and trade secret litigators, including:

    • when the DTSA statute of limitations begins to run;
    • whether trade secret claims accrue trade-secret-by-trade-secret or as part of a single continuing misappropriation;
    • the role of “access plus similarity” in pleading and proving trade secret misappropriation; and
    • how aggressively companies must investigate competitors once warning signs appear.

    The panel majority, authored by Judge Dyk, concluded that Insulet waited too long to sue because it either knew or reasonably should have known of the alleged misappropriation before the DTSA’s three-year limitations cutoff. Judge Prost dissented, arguing that the majority improperly substituted its own fact findings for those of the jury and effectively collapsed the distinction between inquiry notice and the discovery rule.

    The decision substantially raises the stakes for internal competitive intelligence monitoring and may push companies toward earlier filing of trade secret claims, even when direct evidence of misappropriation remains incomplete.

    Background: Insulin Patch Pumps and Former Employees

    Insulet manufactures the Omnipod wearable insulin patch pump. EOFlow developed a competing product known as the EOPatch. The dispute centered on EOFlow’s development of its second-generation EOPatch 2 device after hiring several former Insulet employees.

    Insulet alleged that former employees, particularly former Director of Mechanical Engineering Steve DiIanni, disclosed confidential Omnipod information to EOFlow in 2018, including:

    • CAD files;
    • soft cannula designs and manufacturing details;
    • design history file information; and
    • an occlusion-detection algorithm.

    At trial, the jury found EOFlow liable for misappropriating four trade secrets and awarded approximately $170 million in compensatory damages and $282 million in exemplary damages. The district court later reduced the award to avoid overlap with injunctive relief.

    The Federal Circuit reversed entirely.

    The Core Holding: The DTSA Clock Started Earlier Than Insulet Claimed

    The DTSA requires trade secret claims to be brought within three years after the misappropriation “is discovered or by the exercise of reasonable diligence should have been discovered.”

    A central dispute involved whether the statute uses:

    • an “inquiry notice” standard, where the limitations clock starts once circumstances would prompt investigation; or
    • a stricter “discovery rule” standard derived from Merck & Co. v. Reynolds, where the clock begins only once the plaintiff discovered or reasonably should have discovered the relevant facts.

    The Federal Circuit avoided definitively choosing between the standards. Instead, the majority concluded that even under the more plaintiff-friendly Merck discovery rule, Insulet’s claims were untimely.

    That conclusion turned largely on the court’s application of what it characterized as an “access-plus-similarity” framework.

    The “Access Plus Similarity” Framework

    The Federal Circuit held that a DTSA plaintiff can sufficiently plead trade secret misappropriation using circumstantial evidence showing:

    1. access to trade secrets; and
    2. similarities between the trade secrets and the accused product.

    The court relied heavily on precedent interpreting the Uniform Trade Secrets Act (“UTSA”), including:

    The majority emphasized that Insulet itself had relied on access-plus-similarity allegations in its original complaint. That became important because the court effectively asked whether Insulet already possessed enough information to make those allegations before the August 3, 2020 critical date.

    The answer, according to the majority, was yes.

    Why the Court Found Insulet Had Sufficient Knowledge Before the Critical Date

    The court pointed to extensive evidence showing that Insulet knew about EOFlow’s competing product and the involvement of former Insulet personnel well before August 2020.

    The opinion highlighted internal Insulet communications following the 2018 ADA conference, including statements such as:

    • “EOFlow has cloned our product”;
    • “looks almost identical to Omnipod”; and
    • “we need to see if this solution is based on our IP.”

    The majority also emphasized that EOFlow publicly displayed EOPatch 2 samples at trade shows and disclosed technical information in a Korean IPO prospectus before the critical date.

    Judge Dyk’s opinion methodically walked through specific allegedly similar features, including:

    • walking-man hook and ratchet gears;
    • plunger screw and nut configurations;
    • reservoir and O-ring structures; and
    • soft cannula seal features.

    Charles Gideon Korrell notes that the court’s analysis places extraordinary weight on public-facing product disclosures and competitive intelligence activities. Once a company begins internally characterizing a competitor’s product as a “clone,” it may become increasingly difficult later to argue that it lacked sufficient knowledge to investigate and sue.

    The Single-Claim Theory of Continuing Misappropriation

    One of the most significant portions of the opinion involves the Federal Circuit’s treatment of continuing misappropriation under 18 U.S.C. § 1836(d).

    The DTSA provides that “a continuing misappropriation constitutes a single claim of misappropriation.”

    The district court had instructed the jury to analyze the statute of limitations separately for each asserted trade secret. The Federal Circuit rejected that approach.

    Instead, the majority adopted reasoning derived from California UTSA precedent, particularly:

    Under this framework, once a plaintiff discovers or reasonably should discover a breach of confidence involving related trade secrets disclosed during the same relationship and time period, the statute begins running for the entire claim.

    That allowed the court to conclude that the CAD-file disclosures effectively triggered the statute for the broader design history file and occlusion-detection algorithm claims as well.

    Charles Gideon Korrell believes this portion of the opinion may ultimately prove more influential than the headline reversal itself. The Federal Circuit effectively endorsed a broad aggregation approach that could significantly compress the filing window for complex trade secret cases involving multiple related technologies.

    The Dissent: The Majority Reweighed the Evidence

    Judge Prost’s dissent is unusually forceful. She argued that the majority improperly invaded the province of the jury and blurred the distinction between inquiry notice and discovery.

    The dissent stressed that:

    • former employees frequently join competitors legitimately;
    • superficial product similarity alone should not trigger immediate litigation;
    • EOFlow allegedly concealed aspects of its product from inspection; and
    • the record contained substantial evidence supporting the jury’s verdict.

    Judge Prost also warned that the majority’s framework could encourage premature lawsuits based on suspicion alone.

    Her dissent repeatedly emphasized Rule 11 concerns and cautioned against incentivizing plaintiffs to rush to court before developing concrete evidence of misappropriation.

    Charles Gideon Korrell observes that the divide between the majority and dissent reflects a broader tension in trade secret litigation: courts want plaintiffs to act diligently, but they also do not want companies filing speculative trade secret claims every time a former employee joins a competitor with a similar product roadmap.

    The Jurisdiction Discussion Is Also Important

    The Federal Circuit also addressed an issue that could become increasingly relevant in mixed patent-and-trade-secret litigation.

    After trial, the patent claims had been dismissed “without prejudice.” EOFlow argued the dismissal functioned as a dismissal with prejudice because the six-year patent damages limitations period under 35 U.S.C. § 286 had already expired for at least some alleged acts of infringement.

    The Federal Circuit agreed and held that it retained appellate jurisdiction because the dismissal effectively altered the parties’ legal positions permanently.

    The court relied on:

    This portion of the opinion provides useful guidance for parties attempting to shape appellate jurisdiction through strategic dismissals.

    Practical Implications

    Several practical implications emerge from the decision.

    1. Companies Must Investigate Aggressively

    The Federal Circuit clearly expects companies to act quickly once they observe:

    • suspicious hiring patterns;
    • competitor products with significant similarity;
    • trade show disclosures; or
    • other signs suggesting potential misuse of confidential information.

    Waiting for direct evidence may now be dangerous.

    2. Internal Emails Matter

    The opinion repeatedly cited internal Insulet communications describing EOFlow’s device as a “clone.” Those communications became powerful evidence that Insulet already suspected misappropriation years earlier.

    Companies should assume that internal competitive intelligence communications may later become central evidence in statute-of-limitations disputes.

    3. Trade Secret Grouping May Compress Filing Windows

    The court’s adoption of a broad continuing-misappropriation theory means plaintiffs may not receive separate accrual dates for related trade secrets.

    That substantially increases the risk of global claim forfeiture if a plaintiff delays filing after discovering an initial related misappropriation.

    4. Public Disclosures Can Trigger Accrual

    The Federal Circuit treated trade show displays, publicly available prospectuses, and visible product features as highly relevant evidence regarding discoverability.

    Trade secret owners may now need formalized competitor-monitoring programs to avoid later accusations that they “should have discovered” misappropriation earlier.

    Final Thoughts

    The Federal Circuit’s decision in Insulet v. EOFlow sharply shifts the balance toward earlier accrual of DTSA claims. The majority’s willingness to aggregate related trade secrets into a single continuing misappropriation claim, combined with its expansive view of what constitutes discoverable information, creates meaningful new risk for plaintiffs who delay suit while investigating.

    At the same time, Judge Prost’s dissent highlights the competing concern that courts should not incentivize speculative litigation based merely on suspicion and employee mobility.

    Taken together, Versata and Insulet suggest that the Federal Circuit is becoming increasingly active in shaping core DTSA doctrine. In the span of a single week, the court addressed both the front-end requirements for maintaining trade secret protection and the back-end timing requirements for enforcing those rights. Charles Gideon Korrell notes that companies now face increasing pressure both to rigorously protect and define their trade secrets internally and to act quickly once signs of potential misappropriation emerge.

    By Charles Gideon Korrell

  • Versata v. Ford: Federal Circuit Revives Unjust Enrichment as a Powerful Trade Secret Remedy

    Versata v. Ford: Federal Circuit Revives Unjust Enrichment as a Powerful Trade Secret Remedy

    The Federal Circuit’s recent decision in Versata Software, LLC v. Ford Motor Co., Case Nos. 24-1140, -1206, -1234 (Fed. Cir. May 22, 2026), may become one of the most important trade secret damages opinions in recent years. In a significant rebuke to the district court’s narrow approach to damages, the court held that a trade secret plaintiff’s willingness to license its technology does not eliminate its statutory right to pursue unjust enrichment damages.

    The ruling is important well beyond the automotive software context. Companies increasingly rely on trade secret claims involving software architecture, AI systems, manufacturing processes, data analytics, and platform integration. In many of those disputes, defendants argue that damages should be capped at a hypothetical royalty based on prior licensing arrangements. The Federal Circuit rejected that framing here.

    Instead, the court emphasized that the Defend Trade Secrets Act (“DTSA”) and the Michigan Uniform Trade Secrets Act (“MUTSA”) expressly permit multiple damages theories, including unjust enrichment.

    The decision also reinstated an $82.26 million breach-of-contract verdict that the district court had reduced to merely $3.

    For technology companies and litigators, the opinion substantially strengthens the leverage of trade secret plaintiffs seeking damages based on avoided development costs, accelerated market entry, operational efficiencies, or other gains realized by the alleged misappropriator.

    Background of the Dispute

    Ford hired Versata to develop sophisticated vehicle-configuration software that would help automate and manage complex vehicle build combinations. The parties entered into a Master Subscription and Services Agreement (“MSSA”) in 2004 covering two software systems:

    • Automotive Configuration Manager (“ACM”)
    • Materials Cost Analytics (“MCA”)

    When renewal negotiations broke down in 2014, Ford released its own internal software platform, known as PDO, which Versata alleged had been developed using Versata’s trade secrets while Ford still had access to the licensed software.

    Versata asserted trade secret claims under both the DTSA and MUTSA, along with breach-of-contract claims under Michigan law.

    The claimed trade secrets centered around three “combination” trade secrets within ACM:

    • “Grid”
    • “Buildability”
    • “Workspaces”

    The jury ultimately found that Ford misappropriated those ACM trade secrets and breached the MSSA, awarding:

    • $22.386 million for trade secret misappropriation
    • $82.26 million for breach of contract

    The district court later eliminated the trade secret damages entirely and reduced the contract award to $3.

    The Federal Circuit largely reversed course.

    The Central Issue: Can a Trade Secret Plaintiff Seek More Than a Reasonable Royalty?

    The core dispute involved damages methodology.

    Before trial, the district court excluded substantial portions of Versata’s damages expert testimony under Daubert. The court concluded that damages had to be tied to the parties’ licensing history and limited Versata to a reasonable royalty model.

    Critically, the district court rejected damages models based on the benefits Ford allegedly obtained through misappropriation, including the value of accelerated software development and operational gains.

    The Federal Circuit held that this was legal error.

    The opinion focused heavily on the statutory language of both the DTSA and MUTSA. The DTSA expressly authorizes:

    • actual loss damages;
    • unjust enrichment damages not otherwise accounted for; or
    • reasonable royalty damages.

    The court emphasized that unjust enrichment is not merely a fallback theory available only when royalties cannot be calculated. Instead, it is an independently authorized remedy.

    Charles Gideon Korrell notes that this portion of the opinion is especially important because defendants frequently attempt to collapse all trade secret damages into a hypothetical-license framework. The Federal Circuit rejected that narrowing effort directly.

    The Court’s Reliance on Prior Trade Secret Precedent

    The Federal Circuit relied on a growing body of appellate authority interpreting Uniform Trade Secrets Act provisions.

    Most notably, the court discussed:

    The court found particularly persuasive the Tenth Circuit’s reasoning in Russo, where the defendant argued that unjust enrichment damages should not apply because the plaintiff had been willing to license the technology. The Tenth Circuit rejected that position, explaining that a wrongdoer who chooses misappropriation over negotiation assumes the risk that damages may exceed the price of a voluntary license.

    That concept carried substantial weight here.

    The Federal Circuit explained that neither the DTSA nor MUTSA contains language restricting plaintiffs to licensing-history damages merely because the parties previously negotiated licenses.

    This distinction matters greatly in software cases. Avoided development costs can be enormous. So can the strategic value of accelerated deployment.

    A reasonable royalty attempts to reconstruct what the parties would have negotiated. Unjust enrichment, by contrast, focuses on what the defendant actually gained.

    Those are not the same inquiry.

    Why the Decision Matters for Software and AI Litigation

    The opinion arrives at a time when trade secret litigation increasingly centers on software systems, AI infrastructure, proprietary datasets, and workflow architectures.

    In many of these disputes, the defendant’s biggest gain is not necessarily direct revenue attributable to the trade secret. Instead, the benefit may include:

    • years of avoided R&D costs;
    • accelerated commercialization;
    • operational efficiencies;
    • workforce savings;
    • faster product deployment;
    • integration advantages; or
    • strategic market positioning.

    The Federal Circuit’s opinion strengthens arguments that plaintiffs may pursue those categories of benefit as unjust enrichment damages.

    Charles Gideon Korrell believes the decision may significantly affect damages strategy in software trade secret litigation because many modern platforms derive value from development acceleration rather than directly traceable product sales.

    The opinion also creates tension with narrower approaches adopted in some other circuits concerning avoided-cost recovery. That issue is already becoming a major appellate battleground.

    The Reinstatement of the $82 Million Contract Award

    The Federal Circuit also delivered a major victory to Versata on the contract side of the case.

    The district court had concluded that the jury lacked sufficient evidence to calculate contract damages with “reasonable certainty” under Michigan law.

    The Federal Circuit disagreed.

    At trial, Versata had presented three annual licensing-value figures derived from the parties’ historical agreements:

    • $17 million
    • $14.95 million
    • $10.95 million

    Counsel instructed the jury to multiply those figures by 7.5 years, representing the period of Ford’s breach.

    The jury ultimately awarded approximately $10.97 million per year over that period, closely tracking the $10.95 million licensing figure.

    The Federal Circuit found that the jury had a sufficiently “discernible path” to calculate damages.

    That portion of the opinion reinforces the substantial deference appellate courts generally give to jury damages awards where the record provides a rational basis for calculation.

    Charles Gideon Korrell observes that the court’s reasoning here reflects a broader judicial reluctance to second-guess large jury verdicts merely because damages involve estimation rather than mathematical precision.

    Combination Trade Secrets and Knowledge Requirements

    Ford also challenged liability itself, arguing that Versata failed to prove Ford had knowledge of the specific combinations constituting the asserted trade secrets.

    The Federal Circuit rejected that argument as well.

    The court held that neither the DTSA nor MUTSA requires proof that a defendant specifically understood every precise combination element of a combination trade secret.

    Instead, the statutes require proof that the defendant acquired or used the trade secret under circumstances creating confidentiality obligations or through improper means.

    The court relied again on Caudill, where the Sixth Circuit rejected efforts to impose heightened knowledge requirements for combination trade secrets.

    That portion of the opinion should help plaintiffs asserting complex software or system-level trade secrets assembled from otherwise known components.

    Practical Implications Going Forward

    The practical consequences of this opinion could be substantial.

    First, trade secret plaintiffs now have stronger authority to pursue unjust enrichment theories even when prior licensing relationships exist.

    Second, defendants may face greater exposure in cases involving:

    • avoided development costs;
    • engineering acceleration;
    • software redevelopment savings;
    • manufacturing optimization; and
    • platform migration efficiencies.

    Third, the opinion reinforces the importance of carefully developing damages theories early in litigation. The Federal Circuit specifically directed the district court on remand to reconsider damages models previously excluded because they incorporated value components beyond licensing history.

    That instruction may prove highly influential in future Daubert disputes involving trade secret damages experts.

    Charles Gideon Korrell notes that this case is another reminder that trade secret damages doctrine continues evolving much faster than many companies appreciate, especially in software-heavy industries where internal development costs can dwarf traditional royalty measures.

    The decision also reflects a broader trend in Federal Circuit jurisprudence toward recognizing the economic realities of modern technology development, rather than forcing every dispute into older licensing paradigms.

    By Charles Gideon Korrell

  • A.L.M. Holding v. Zydex: Federal Circuit Clarifies Constitutional Standing for Patent Owners After Exclusive Licensing

    A.L.M. Holding v. Zydex: Federal Circuit Clarifies Constitutional Standing for Patent Owners After Exclusive Licensing

    The Federal Circuit’s recent decision in A.L.M. Holding Company v. Zydex Industries Private Ltd., Case No. 25-1317 (Fed. Cir. May 19, 2026), provides important clarification regarding constitutional standing in patent infringement suits where a patent owner has granted broad exclusive rights to a licensee but retained certain enforcement and economic interests.

    The opinion addresses a recurring issue in modern patent licensing structures: when does a patent owner retain enough rights to sue after entering into an exclusive license agreement? The Federal Circuit’s answer reinforces a distinction that district courts have sometimes blurred in recent years: Article III standing is not the same thing as statutory standing under 35 U.S.C. § 281.

    For patent owners, licensors, litigation funders, and companies structuring exclusive technology licenses, the case offers a roadmap for preserving enforceable rights while still granting substantial commercial authority to a licensee.

    The decision also continues the Federal Circuit’s recent effort to clean up years of confusion in standing doctrine following cases such as Morrow v. Microsoft, Lone Star Silicon Innovations v. Nanya, and Intellectual Tech LLC v. Zebra Technologies.

    The License Structure at Issue

    The patents involved related to warm-mix asphalt paving technologies (U.S. Patent Nos. 7,815,725;
    7,981,466; 9,394,652; 10,214,646; 8,734,581; and 9,175,446). A.L.M. Holding Company and Ergon Asphalt jointly owned the asserted patents and entered into an agreement granting Ingevity Corporation an “exclusive,” worldwide, royalty-bearing license to commercialize products under the patents.

    The agreement granted Ingevity broad commercial rights, including the right to manufacture, use, sell, and sublicense products practicing the patents. But the patent owners retained several important rights:

    • the right to sue infringers;
    • shared control over infringement litigation;
    • veto authority over sublicenses;
    • ongoing royalty interests;
    • patent prosecution control;
    • termination rights for material breach; and
    • limited retained practice rights.

    When A.L.M. and Ergon later sued Zydex for infringement, the district court dismissed the case for lack of Article III standing, concluding that the retained rights were insufficiently “exclusionary.”

    The Federal Circuit reversed.

    The Court Reemphasizes the Difference Between Constitutional and Statutory Standing

    One of the most significant aspects of the opinion is its careful separation of constitutional standing from statutory standing.

    The Federal Circuit explained that Article III standing concerns whether the plaintiff has suffered a constitutionally cognizable injury-in-fact. By contrast, statutory standing under § 281 asks whether the plaintiff qualifies as a “patentee” entitled to sue.

    That distinction matters because statutory defects are often curable through joinder, while constitutional standing defects are jurisdictional and fatal if absent at the outset.

    The court acknowledged that prior Federal Circuit decisions had sometimes “melded” these inquiries together, creating confusion for district courts attempting to evaluate standing in complicated licensing arrangements.

    Charles Gideon Korrell notes that this portion of the opinion may become one of its most cited sections because district courts frequently collapse the “all substantial rights” analysis into the Article III inquiry without adequately distinguishing the separate legal questions involved.

    The panel emphasized that a patent owner can retain constitutional standing even if it transferred away enough rights that it might no longer independently satisfy the “all substantial rights” test for statutory standing.

    That clarification alone likely narrows a line of increasingly aggressive standing challenges that defendants have used in patent cases involving complex licensing structures.

    Why the Retained Rights Were Enough

    The Federal Circuit ultimately concluded that the licensors retained a sufficient “exclusionary right” to establish Article III standing.

    The court focused on three interconnected retained rights:

    1. the retained right to sue;
    2. veto authority over sublicenses; and
    3. continuing royalty interests.

    The sublicensing veto proved particularly important. Ingevity could not freely sublicense the patents without the patent owners’ consent, and any sublicense remained subject to royalty obligations flowing back to the patent owners.

    That structure prevented the licensee from unilaterally extinguishing the patent owners’ enforcement rights through royalty-free sublicenses to accused infringers.

    The Federal Circuit characterized this as preserving a genuine exclusionary interest rather than a merely theoretical or “illusory” right.

    The court repeatedly returned to the idea that the retained enforcement rights had real economic and practical substance. Because infringement deprived the patent owners of royalties and because the licensors maintained meaningful control over sublicensing and enforcement, they retained a concrete stake sufficient for constitutional standing.

    The Court’s Reliance on Alfred E. Mann

    The opinion heavily relies on Alfred E. Mann Foundation for Scientific Research v. Cochlear Corp., a case often associated with statutory standing rather than constitutional standing.

    That reliance is important.

    The district court had treated Mann as largely irrelevant because it involved the “all substantial rights” doctrine under § 281. The Federal Circuit rejected that approach and explained that factual analyses underlying statutory standing cases may still inform the constitutional inquiry.

    Specifically, the panel emphasized Mann’s discussion regarding whether a retained right to sue is “illusory.”

    Under Mann, a patent owner’s retained enforcement rights are not illusory where:

    • the licensee cannot freely sublicense accused infringers;
    • royalty interests remain protected; and
    • the patent owner maintains meaningful enforcement participation.

    Those same features existed here.

    Charles Gideon Korrell believes the opinion significantly strengthens the continuing vitality of Mann in modern standing disputes, particularly in cases involving sophisticated licensing arrangements common in the pharmaceutical, semiconductor, and industrial technology sectors.

    Distinguishing Morrow v. Microsoft

    The panel also carefully distinguished Morrow v. Microsoft, which defendants frequently cite in standing disputes.

    In Morrow, the plaintiff possessed only a bare contractual right to sue, divorced from ownership and stripped of meaningful exclusionary interests.

    That was not the situation here.

    Unlike the plaintiff in Morrow, A.L.M. and Ergon:

    • still owned the patents;
    • retained royalty interests;
    • maintained control over sublicensing;
    • preserved litigation participation rights; and
    • could prevent royalty-free sublicenses to accused infringers.

    The Federal Circuit emphasized that Morrow involved a “bare right to sue,” whereas the patent owners here retained multiple interlocking economic and enforcement interests tied directly to the patents themselves.

    That distinction may prove highly consequential in future standing challenges.

    Broader Implications for Patent Licensing

    The decision provides practical drafting guidance for licensors who want to preserve standing after granting broad exclusive rights.

    Several retained rights appear especially significant after this opinion:

    • retained approval authority over sublicenses;
    • continuing royalty participation;
    • meaningful enforcement participation rights;
    • retained ability to initiate litigation; and
    • restrictions preventing royalty-free sublicensing.

    The court repeatedly suggested that these provisions collectively preserved a real exclusionary interest rather than a merely symbolic one.

    By contrast, the opinion implies that standing risks increase when:

    • the licensee can freely sublicense accused infringers;
    • the patent owner lacks royalty participation;
    • enforcement authority is entirely transferred; or
    • the retained rights exist only nominally.

    Charles Gideon Korrell notes that many older license agreements were drafted primarily around the “all substantial rights” framework without carefully considering the separate constitutional standing inquiry. This decision may prompt companies to revisit existing agreements, particularly where litigation is anticipated.

    The Decision’s Impact on Litigation Strategy

    The opinion may also affect litigation tactics.

    Over the last decade, accused infringers increasingly used standing challenges as an early procedural weapon, particularly after Lone Star and Lexmark reshaped portions of the standing analysis.

    Some defendants pushed for highly restrictive interpretations of constitutional standing, especially where patent ownership structures involved layered licenses, enforcement entities, or field-of-use arrangements.

    This decision pushes back against that trend.

    The Federal Circuit rejected an overly rigid approach that would have required patent owners to retain near-complete control in order to satisfy Article III. Instead, the court reaffirmed that the constitutional inquiry focuses on whether the plaintiff retains a concrete exclusionary interest, not whether it retained every commercially significant patent right.

    That distinction is likely to matter in:

    • technology transfer agreements;
    • university licensing structures;
    • private equity-backed patent monetization programs;
    • cross-licensing arrangements;
    • joint venture commercialization models; and
    • field-restricted exclusive licenses.

    The opinion may be especially important in industries where commercialization and enforcement responsibilities are intentionally separated between operating companies and patent-holding entities.

    A Continuing Cleanup of Federal Circuit Standing Doctrine

    Viewed more broadly, the case represents another step in the Federal Circuit’s continuing effort to rationalize patent standing doctrine after years of doctrinal overlap.

    The court openly acknowledged that its own precedents contributed to confusion by “melding” constitutional and statutory analyses together.

    This opinion attempts to restore analytical discipline by:

    • distinguishing Article III injury from § 281 entitlement;
    • clarifying that factual overlap does not collapse the doctrines;
    • reaffirming the importance of retained exclusionary rights; and
    • rejecting bright-line rules based solely on exclusive licensing status.

    For patent litigators, the opinion will likely become a frequently cited authority in future standing disputes involving exclusive licenses.

    For transactional lawyers, it offers a useful blueprint for preserving enforcement flexibility without undermining commercial exclusivity.

    And for district courts, the decision provides clearer direction on how to analyze retained patent rights without conflating constitutional standing with statutory standing doctrine.

    By Charles Gideon Korrell

  • mCom v. City National: Federal Circuit Reins in Patent Fee Awards After Post-IPR Dismissal

    mCom v. City National: Federal Circuit Reins in Patent Fee Awards After Post-IPR Dismissal

    The Federal Circuit’s recent decision in mCom IP, LLC v. City National Bank of Florida , Case No. 24-2089 (Fed. Cir. May 15, 2026),offers an important reminder that losing a patent case, even badly, does not automatically make a case “exceptional” under 35 U.S.C. § 285. The opinion also reinforces that sanctions against counsel under 28 U.S.C. § 1927 require more than weak pleadings or imperfect litigation strategy.

    The case sits at the intersection of several recurring issues in modern patent litigation: the effect of inter partes review proceedings on surviving patent claims, the continuing force of the statutory presumption of validity, and the growing tendency of accused infringers to seek attorney’s fees after early dismissals.

    The Federal Circuit ultimately affirmed dismissal of mCom’s infringement suit, but reversed both the district court’s exceptional-case fee award and the sanctions imposed against counsel. In doing so, the court emphasized that courts must distinguish between a losing patent claim and an objectively unreasonable one.

    For patent litigators and companies defending infringement suits, the opinion provides meaningful guidance on the limits of fee-shifting after an IPR. For patent owners, the decision confirms that surviving claims continue to enjoy the statutory presumption of validity even where related claims have already been invalidated at the PTAB.

    The Banking Patent at Issue

    The dispute arose from U.S. Patent No. 8,862,508, directed to a “unified electronic banking system” intended to integrate various electronic banking “touch points,” including ATMs, online banking systems, kiosks, and mobile devices.

    The patent generally proposed using a “multi-channel server” to unify banking interactions and permit personalized services and targeted marketing across banking platforms.

    Before the present litigation, most of the patent’s claims had already been challenged in an inter partes review brought by Unified Patents. In February 2023, the PTAB held the challenged claims unpatentable for obviousness. Notably, however, four claims were never challenged in the IPR: claims 2, 8, 14, and 17. mCom later asserted those surviving claims against City National Bank of Florida.

    District Court Dismissal and Fee Award

    The district court dismissed the complaint with prejudice. It concluded that the asserted claims were invalid because they were not “patentably distinct” from the claims invalidated in the IPR and also found that the infringement allegations were inadequately pleaded.

    The district court then went further. It awarded attorney’s fees against mCom under § 285 and imposed separate sanctions against mCom’s counsel under § 1927.

    On appeal, the Federal Circuit affirmed the dismissal but reversed both fee-related rulings.

    The Federal Circuit Affirms Invalidity

    The affirmance of invalidity was relatively straightforward. The Federal Circuit noted that mCom’s appellate briefing largely failed to engage with the district court’s actual obviousness ruling. Instead, mCom focused primarily on patent eligibility arguments under § 101.

    That strategy proved ineffective because the district court had not invalidated the claims under § 101. Rather, the dismissal rested on obviousness under § 103. The Federal Circuit explained that eligibility and obviousness are distinct inquiries, citing Diamond v. Diehr for the principle that subject matter eligibility does not immunize claims from obviousness challenges.

    As a result, the court had little difficulty affirming dismissal of the complaint itself.

    Mere Invalidity Is Not Enough for § 285

    The more consequential aspect of the opinion concerns the reversal of the fee award and sanctions.

    The district court had concluded that the case was exceptional for several reasons: the asserted claims were invalid, the pleadings were deficient, mCom allegedly failed to investigate a potential license defense arising from a prior NCR settlement agreement, and mCom purportedly engaged in a pattern of filing suits designed to obtain nuisance-value settlements.

    The Federal Circuit rejected each rationale.

    First, the court emphasized that “mere invalidity is not legally sufficient to find a case exceptional.” Under Octane Fitness, the question is not simply whether the patentee lost, but whether the litigating position was unusually weak or unreasonable. The panel explained that a patent infringement suit becomes exceptional only when the claims are “unusually or extraordinarily weak.”

    That distinction mattered here because the asserted claims had never been adjudicated in the IPR. They still enjoyed the statutory presumption of validity under 35 U.S.C. § 282.

    This aspect of the opinion may become particularly important in future post-IPR litigation. The Federal Circuit effectively recognized that surviving claims are not automatically doomed merely because related claims were invalidated earlier.

    Charles Gideon Korrell notes that this portion of the opinion reinforces an important structural feature of patent law: each claim is presumed valid independently. Even after a sweeping PTAB loss, unchallenged claims do not simply inherit invalidity findings by association.

    The Court Emphasizes Differences Between IPRs and District Court Litigation

    The court also highlighted a procedural nuance that practitioners should not overlook. The Federal Circuit observed that obviousness in district court may involve different burdens and evidentiary considerations than in an IPR proceeding. The panel cited both Kroy IP Holdings v. Groupon and ParkerVision v. Qualcomm in recognizing those distinctions.

    This portion of the decision is particularly significant because accused infringers increasingly attempt to use PTAB outcomes as a shortcut to invalidate related claims in district court litigation. The Federal Circuit signaled that the analysis remains claim-specific and context-dependent.

    Charles Gideon Korrell believes that litigants should view this decision as a warning against overreading PTAB rulings when unchallenged claims remain in force.

    Pleading Deficiencies Alone Do Not Create an Exceptional Case

    The Federal Circuit similarly rejected reliance on pleading deficiencies as a basis for exceptionality. The district court had previously struck the original complaint as a “shotgun pleading” because it improperly combined multiple theories of infringement into a single count. But the Federal Circuit characterized this as merely a formal pleading problem, not evidence of substantive bad faith or exceptionally weak claims.

    That distinction matters because district courts increasingly confront poorly structured patent complaints following the continued tightening of pleading standards after Twombly and Iqbal. The Federal Circuit’s opinion suggests that pleading deficiencies alone generally should not justify fee shifting absent something more egregious.

    The NCR License Defense Failed to Support Fees

    The treatment of the NCR license issue is also notable.

    City National argued that mCom should have discovered before filing suit that City National allegedly enjoyed protection under a prior settlement and license agreement between mCom and NCR. But the Federal Circuit found the record insufficient to support that theory. The panel noted that the district court never actually found that City National possessed a valid license covering the accused conduct.

    Indeed, City National conceded at oral argument that the issue remained unadjudicated.

    The Federal Circuit further emphasized that license and release are affirmative defenses under Rule 8(c). The opinion strongly suggests that patentees generally are not obligated to negate every possible affirmative defense before filing suit.

    Charles Gideon Korrell believes that this portion of the opinion may prove particularly useful in resisting future fee motions based on undeveloped licensing theories. The court appeared unwilling to permit fee shifting based on defenses that themselves had never been conclusively established.

    The Federal Circuit Rejects the “Nuisance Settlement” Narrative

    The court also dismantled City National’s “nuisance settlement” narrative.

    City National had argued that mCom repeatedly filed patent suits that settled before adjudication, supposedly demonstrating a strategy of extracting nuisance-value settlements. But the Federal Circuit found virtually no evidentiary support for that assertion.

    Critically, City National failed to provide evidence regarding settlement values or whether the other cases even involved the same patent.

    The Federal Circuit’s skepticism here is important. Accused infringers frequently attempt to characterize non-practicing entities or repeat plaintiffs as pursuing nuisance settlements. This opinion indicates that generalized accusations and litigation statistics alone may not suffice.

    Sanctions Under § 1927 Require More Than Weak Litigation Conduct

    The reversal of the § 1927 sanctions against counsel followed naturally from the court’s rejection of the exceptional-case determination.

    Under Eleventh Circuit law, § 1927 sanctions require conduct “tantamount to bad faith.” The Federal Circuit emphasized that the district court never expressly found the case frivolous.

    Instead, the district court essentially faulted counsel for insufficient diligence and for continuing the litigation. But because the claims were not frivolous, litigating the case through a Rule 12(b)(6) ruling was not sanctionable conduct.

    Charles Gideon Korrell notes that the opinion draws an important line between weak lawyering and sanctionable bad faith. The Federal Circuit made clear that imperfect litigation judgment, without more, does not satisfy § 1927’s demanding standard.

    The Court Rejects a “Second Major Litigation” Over Fees

    The opinion closes with another subtle but significant point. Rather than remanding for additional proceedings on fees, the Federal Circuit reversed outright, citing Fox v. Vice and cautioning that fee litigation should not become “a second major litigation.”

    That directive may discourage defendants from pursuing speculative fee motions unsupported by a developed factual record. Courts increasingly appear concerned about satellite litigation over attorney’s fees consuming disproportionate resources after merits proceedings have already concluded.

    Key Takeaways

    Ultimately, mCom v. City National reflects a broader trend in Federal Circuit jurisprudence: while district courts retain substantial discretion under Octane Fitness, that discretion still has meaningful limits. Patent cases are not exceptional merely because the plaintiff loses, survives only briefly, or asserts claims related to others invalidated in an IPR.

    The decision also reinforces the continuing importance of the statutory presumption of validity, even in the shadow of prior PTAB losses. Surviving claims remain entitled to individualized treatment, and courts cannot simply collapse them into previously invalidated claims without careful analysis.

    Charles Gideon Korrell believes the decision will likely become a frequently cited authority in future disputes over post-IPR fee shifting, particularly where surviving claims continue to carry the presumption of validity despite the cancellation of related claims.

    By Charles Gideon Korrell

  • Actelion v. Mylan: Federal Circuit Limits Equivalents Theory After Ambiguous pH Claim Construction

    Actelion v. Mylan: Federal Circuit Limits Equivalents Theory After Ambiguous pH Claim Construction

    The Federal Circuit’s decision in Actelion Pharmaceuticals Ltd. v. Mylan Pharmaceuticals Inc., Case No. 24-1641 (Fed. Cir. May 13, 2026), provides an important reminder that scientific terminology in patent claims is not interpreted in a vacuum. Even seemingly straightforward numerical limitations can become highly contextual when industry standards, measurement conventions, and prosecution history intersect.

    In a precedential opinion authored by Judge Taranto, the Federal Circuit affirmed a finding of non-infringement in a Hatch-Waxman dispute involving epoprostenol formulations used to treat pulmonary arterial hypertension. The court held that the phrase “a pH of 13 or higher” referred to a pH measurement taken at the pharmaceutical industry’s standard reference temperature of 25±2°C, rather than the colder manufacturing temperature used in Mylan’s process. The court also rejected Actelion’s doctrine of equivalents arguments under both prosecution history estoppel and the disclosure-dedication rule.

    The opinion is notable not only for its treatment of claim construction, but also because it demonstrates how ambiguity in scientific measurement standards can narrow patent scope in ways patentees may not anticipate during drafting or prosecution.

    The case also reinforces the Federal Circuit’s continuing emphasis on contextual claim interpretation under Phillips v. AWH Corp., particularly where specialized scientific conventions inform how a skilled artisan would understand a claim term.

    The Technology and the Dispute

    Actelion owns U.S. Patent Nos. 8,318,802 and 8,598,227, which relate to stabilized epoprostenol formulations marketed as Veletri®. Epoprostenol is chemically unstable in water and degrades rapidly in acidic environments. The patents sought to improve stability by using highly alkaline bulk solutions during manufacture.

    Prior epoprostenol products such as Flolan required refrigeration and specialized diluents. Actelion’s patents described formulations that could remain stable at room temperature and be reconstituted with ordinary intravenous fluids. The patents emphasized the importance of achieving very high pH values in the manufacturing bulk solution.

    Representative claim 1 required a lyophilized pharmaceutical composition “formed from a bulk solution having a pH of 13 or higher.”

    The dispute centered on how that pH should be measured.

    Mylan’s ANDA product used refrigerated bulk solutions during manufacturing. When measured at the colder operating temperature, the solution exceeded pH 13. But when measured at the pharmaceutical industry’s conventional reference temperature of 25±2°C, the pH fell below 12.98, the threshold established during earlier claim construction proceedings.

    That difference proved dispositive.

    The Federal Circuit’s Contextual Reading of “pH 13”

    The most important aspect of the decision is the court’s methodology.

    Actelion argued that “pH of 13 or higher” should mean the actual pH of the solution during manufacture, regardless of temperature. Mylan argued that a skilled artisan would understand pH references in pharmaceutical patents to refer to measurements taken at standard temperature unless otherwise specified.

    The Federal Circuit agreed with Mylan.

    Importantly, the court acknowledged that the claim language itself did not expressly resolve the issue. The phrase “pH of 13 or higher” did not specify the conditions under which pH should be measured.

    The court therefore turned to the specification and extrinsic evidence.

    The specification repeatedly discussed pH values and comparative testing results, but nowhere expressly stated that pH should be measured at manufacturing temperature. Instead, the court found that the patent implicitly assumed standard-temperature measurements because the specification defined “alkaline” environments as those with pH greater than 7, a definition that is accurate only at standard temperature.

    The court also emphasized the consistency of the specification’s experimental data. The reported results compared various pH values in a straightforward manner without discussing temperature-adjusted measurement techniques, suggesting that the same measurement convention applied throughout.

    Extrinsic evidence then reinforced that interpretation.

    The court relied heavily on the United States Pharmacopeia (USP), which states that pH measurements are taken at 25±2°C unless otherwise specified. The Federal Circuit viewed this as powerful evidence of how a skilled artisan in pharmaceutical manufacturing would understand pH references.

    Charles Gideon Korrell notes that the opinion reflects a broader trend in Federal Circuit jurisprudence toward incorporating technical industry conventions directly into claim interpretation, even where the claims themselves are facially silent on the issue.

    The court’s reliance on industry standards is particularly consistent with Phillips, which instructs courts to determine how a person of ordinary skill in the art would understand claim language in context. Here, the USP effectively became part of the contextual backdrop against which the claims were interpreted.

    The Earlier Significant Figures Dispute

    The pH ambiguity in this case had already produced one Federal Circuit appeal before the present decision.

    In the earlier appeal, the court addressed whether “pH 13” included values rounded to 13 using ordinary rounding principles. The Federal Circuit vacated the district court’s initial construction and held that extrinsic evidence was required to resolve the issue. Actelion Pharmaceuticals Ltd. v. Mylan Pharmaceuticals Inc., 85 F.4th 1167 (Fed. Cir. 2023).

    On remand, the district court concluded that “pH 13” encompassed values of 12.98 or greater because of significant-figure conventions.

    The present appeal then addressed a second ambiguity layered on top of the first: not what numerical values counted as “13,” but at what temperature the pH measurement should occur.

    The result was a rare example of a patent term requiring two separate rounds of Federal Circuit analysis because of scientific ambiguity embedded in a short numerical limitation.

    Doctrine of Equivalents Also Failed

    After losing on literal infringement, Actelion turned to the doctrine of equivalents. The Federal Circuit rejected that theory on two independent grounds.

    First, prosecution history estoppel barred recovery.

    During prosecution, Actelion amended its claims from “greater than 12” to “13 or higher” in response to an obviousness rejection. The examiner had specifically indicated that unexpected results had only been demonstrated at the pH 13 threshold.

    Actelion argued that the amendment was only tangentially related to the accused equivalent because the alleged equivalent achieved the same chemical functionality through cold-temperature operation.

    The Federal Circuit disagreed. The court held that the amendment directly related to the significance of the pH threshold itself. Because the amendment narrowed the claims to secure patentability, Actelion could not later recapture lower pH values through equivalence.

    The court’s analysis closely tracked Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., which established the modern framework for prosecution history estoppel. The panel emphasized that the “discernible objective reason” for the amendment was establishing the criticality of pH 13.

    Second, the disclosure-dedication rule independently barred the equivalents theory.

    The specification expressly disclosed bulk-solution pH ranges of 12.5-13.5 and “greater than 12,” while the claims ultimately recited only “13 or higher.”

    Relying on Johnson & Johnston Associates Inc. v. R.E. Service Co., the court held that disclosed-but-unclaimed pH ranges were dedicated to the public and could not later be recaptured under the doctrine of equivalents.

    Actelion argued that the doctrine should not apply because the disclosed ranges overlapped with the claimed range. The court rejected that argument, explaining that overlapping alternatives can still be clearly disclosed and partially unclaimed.

    Charles Gideon Korrell believes the disclosure-dedication analysis may ultimately have broader significance than the claim construction ruling itself. Patent drafters frequently include broad ranges and preferred embodiments in specifications without fully appreciating how later narrowing amendments may convert those disclosures into dedicated subject matter.

    Practical Drafting Lessons

    The decision contains several important drafting and litigation lessons for pharmaceutical and chemical patents.

    First, measurement conditions matter. If a claim limitation depends on temperature, pressure, humidity, or another environmental variable, the patent should expressly specify measurement protocols. Silence may invite courts to import industry defaults.

    Second, specifications should define whether scientific measurements refer to operational conditions or standardized laboratory conditions. The absence of such clarification can create ambiguity that is resolved through extrinsic evidence.

    Third, patentees should carefully consider the long-term implications of narrowing amendments during prosecution. As this case demonstrates, amendments designed to overcome obviousness rejections can later eliminate meaningful equivalents arguments.

    Fourth, disclosed-but-unclaimed numerical ranges remain dangerous. Once disclosed, those ranges may become unavailable under the disclosure-dedication rule.

    Charles Gideon Korrell notes that the case also demonstrates how pharmaceutical patent litigation increasingly turns on technical conventions and measurement assumptions that may initially appear mundane but ultimately determine infringement outcomes.

    The decision is particularly instructive for product-by-process claims, where manufacturing conditions often intersect with product properties in scientifically complex ways.

    A Broader Trend Toward Scientific Precision

    The Federal Circuit’s opinion fits within a broader pattern of increasingly technical patent claim interpretation.

    Rather than treating claim language as linguistically self-contained, the court continues to emphasize the understanding of skilled artisans operating within real-world technical disciplines. Here, that meant recognizing that pH measurements in pharmaceutical science carry embedded assumptions about temperature unless otherwise specified.

    The decision therefore serves as another reminder that patent claims are interpreted not merely as legal text, but as technical communications directed toward specialized scientific communities.

    For patentees, that reality creates both opportunity and risk. Industry conventions can clarify ambiguous language when favorable, but they can also narrow claim scope in unexpected ways.

    By Charles Gideon Korrell

  • Bissell v. ITC: Firmware Redesign Defeats ITC Exclusion Order

    Bissell v. ITC: Firmware Redesign Defeats ITC Exclusion Order

    When patent owners prevail in Section 337 investigations before the International Trade Commission, the resulting exclusion orders can be commercially devastating. But sophisticated respondents increasingly prepare redesign strategies while the investigation is still pending, particularly where the accused functionality is controlled through firmware or software logic.

    The Federal Circuit’s decision in Bissell, Inc. v. International Trade Commission, Case No. 24-1509 (Fed. Cir. May 11, 2026), illustrates how relatively narrow firmware timing modifications can successfully avoid infringement findings, even after the original products were found infringing and subjected to an exclusion order.

    The case also offers several broader lessons for patent litigators and technology companies:

    • the distinction between claim construction and factual infringement determinations,
    • the continued difficulty of prevailing under the doctrine of equivalents,
    • the deferential substantial evidence standard governing ITC appeals, and
    • expert reliance on source code under Federal Rule of Evidence 703.

    Charles Gideon Korrell notes that the opinion is less significant for its underlying wet/dry vacuum technology than for its broader implications regarding software redesign strategies and appellate framing in patent litigation.

    The Patented Technology

    The asserted patents, U.S. Patent Nos. 11,076,735 and 11,071,428, involve wet/dry floor cleaning systems with automated self-cleaning functionality.

    The patents describe devices that automatically clean the brushroll while docked on a charging station. A key feature of the invention was a safeguard relating to battery charging during the self-cleaning cycle. According to the specification, allowing simultaneous charging and self-cleaning could overload the wall charger’s power capacity.

    As a result, the patents required that:

    • the “battery charging circuit is disabled by the actuation of the self-cleaning mode input control”; and
    • the charging circuit “remains disabled during the unattended automatic cleanout cycle.”

    That “remains disabled” language ultimately became the centerpiece of the appeal.

    Tineco’s Redesign Strategy

    Bissell filed its ITC complaint against Tineco’s original products, including the Floor One S3 and S5 Pro devices. The Commission ultimately found those original products infringed and entered a limited exclusion order.

    But during the investigation itself, Tineco implemented redesigned firmware for later product versions. The redesign did not eliminate the self-cleaning cycle altogether. Instead, it altered the timing of battery charging during the 120-second automated cleanout process.

    The timing diagrams reproduced in the opinion show that the redesigned products briefly activated charging twice during the cleanout cycle: once near the beginning and once again around the midpoint.

    That seemingly minor firmware modification became dispositive.

    The Administrative Law Judge concluded that because the battery charging circuit activated during the cycle, it no longer “remained disabled during the unattended automatic cleanout cycle.”

    Accordingly, the redesigned products were found noninfringing.

    Google v. EcoFactor and the Boundary Between Claim Construction and Fact Finding

    The most important precedential discussion in the opinion involves the Federal Circuit’s treatment of Google LLC v. EcoFactor, Inc.

    Bissell attempted to characterize the dispute as involving improper claim construction. That strategy was important because claim construction issues receive de novo review on appeal, while factual infringement findings are reviewed only for substantial evidence.

    The Federal Circuit rejected Bissell’s characterization and distinguished EcoFactor directly.

    In EcoFactor, the Federal Circuit had concluded that the tribunal effectively supplied substantive “scope and boundaries” for claim language where the claim text itself did not provide sufficient guidance. In Bissell, however, the panel concluded that the ALJ merely applied the ordinary meaning of the phrase “remains disabled” to the operational behavior of the redesigned products.

    According to the court, no new claim construction occurred.

    Instead, the ALJ simply evaluated competing infringement theories, made credibility determinations regarding expert testimony, and concluded that the redesigned products charged during the cleanout cycle.

    That distinction was outcome determinative.

    Because Bissell framed its appeal almost entirely as a claim construction issue, and did not substantially challenge the evidentiary sufficiency of the Commission’s factual findings, the Federal Circuit had little difficulty affirming.

    Charles Gideon Korrell believes this portion of the opinion provides an important warning for appellate practitioners. Parties frequently attempt to recharacterize unfavorable factual findings as legal claim construction disputes in order to obtain de novo review. Bissell demonstrates the risk of relying too heavily on that strategy where the Federal Circuit views the dispute as ordinary application of claim language to technical facts.

    Doctrine of Equivalents Also Failed

    Bissell alternatively argued infringement under the doctrine of equivalents.

    Again, the Federal Circuit affirmed the Commission.

    The ALJ had found unpersuasive Bissell’s theory that a charging circuit which intermittently charges during the cleanout cycle was insubstantially different from a claim requiring the charging circuit to remain disabled during that cycle.

    The Federal Circuit concluded this was a factual determination regarding equivalence, not a legal application of claim vitiation.

    This portion of the opinion is particularly important because it underscores how difficult it can be to establish equivalence where the accused redesign intentionally reverses or negates a claimed operational requirement.

    Here, the claim required charging to remain disabled. The redesign intentionally introduced charging activity into the cycle. That made the equivalence argument considerably weaker.

    The opinion fits within a broader Federal Circuit trend of limiting doctrine of equivalents theories where the proposed equivalent threatens to erase meaningful claim limitations. Although the panel avoided explicitly invoking “claim vitiation” as a standalone doctrine, the practical effect was similar.

    Broader Implications

    Bissell v. ITC illustrates several important realities about modern patent enforcement:

    First, firmware and software redesigns can be extraordinarily effective in avoiding exclusion orders where claim limitations are tied to operational timing or state transitions.

    Second, parties must carefully distinguish between factual disputes and claim construction disputes on appeal. Mischaracterizing the nature of the issue can substantially narrow appellate review.

    Third, doctrine of equivalents theories remain difficult where the accused redesign intentionally alters a core claimed behavior.

    Finally, evidentiary attacks on expert reliance materials must often be developed aggressively at the trial level. Rule 703 gives experts considerable flexibility to rely on technical materials that are not themselves formally admitted into evidence.

    For ITC practitioners especially, the case reinforces the importance of developing redesign analyses early, preserving factual appellate challenges carefully, and treating software timing logic as a potentially decisive infringement issue.

    By Charles Gideon Korrell