Technology & Information Law Blog by Charles Gideon Korrell

Tag: patent law

  • Acorda v. Alkermes: When Alternative Theories Shut the Federal Circuit Door

    Acorda v. Alkermes: When Alternative Theories Shut the Federal Circuit Door

    The Federal Circuit’s July 2025 decision in Acorda Therapeutics, Inc. v. Alkermes PLC, No. 2023-2374 (Fed. Cir. July 25, 2025), is the latest reminder that most “non-patent patent cases” will not make it past the courthouse steps on Madison Place. The court held that it lacked jurisdiction to review Acorda’s challenge to an international arbitration award—despite the heavy reliance on

    and related patent-law arguments—because Acorda pleaded an alternative, non-patent basis for relief. Under Gunn v. Minton, that meant the patent issue was not necessarily raised, and the appeal belonged in the Second Circuit, not the Federal Circuit.

    This result leaves some tricky questions open, especially about patent-law challenges to arbitral awards and the interaction of Brulotte with state-law doctrines like New York’s Voluntary Payment Doctrine (NYVPD). As Charles Gideon Korrell likes to remind clients, “jurisdiction is its own battlefield”—and this case proves the point with a forward-thinking flourish.

    I. Background: A Patent Expiration, Continued Royalties, and a Fight Over Refunds

    Acorda developed Ampyra®, a drug improving mobility for multiple-sclerosis patients. Alkermes owned U.S. Patent No. 5,540,938, covering the sustained-release formulation of dalfampridine, and licensed it to Acorda through a joint-venture structure later replaced with a new License and Supply Agreement. Royalties continued at 18% of net sales—10% under the License Agreement and 8% under the Supply Agreement. The patent expired in July 2018, but Acorda continued paying royalties without protest for almost two years.

    By mid-2020, after generics entered the market, Acorda reversed course. Relying on Brulotte v. Thys Co., 379 U.S. 29 (1964), and its reaffirmation in Kimble v. Marvel, 576 U.S. 446 (2015), Acorda initiated arbitration seeking (1) a declaration that post-expiration royalties were unenforceable and (2) recoupment of more than $80 million in payments made after July 2018.

    The arbitration panel agreed the contracts became unenforceable at patent expiration, but concluded that:

    • Only protested payments—those beginning in July 2020—were recoverable.
    • Payments made without protest were barred by the New York Voluntary Payment Doctrine, which prevents restitution of voluntarily made payments “with full knowledge of the facts.”
      See Dillon v. U-A Columbia Cablevision, 740 N.Y.S.2d 396 (App. Div. 2002).

    Total awarded refund: $16.55 million, not the $80+ million Acorda sought.

    Acorda sought confirmation of the parts of the award it liked and modification of the part it didn’t—arguing that the NYVPD could not override Brulotte’s federal prohibition on post-expiration royalties.

    II. The District Court: No Manifest Disregard of Patent Law

    The district court confirmed the award in full. The key move was distinguishing between:

    1. Enforceability of post-expiration royalties (addressed by Brulotte), and
    2. Remedies, specifically whether refunds were required for payments made before protest.

    The court held that:

    • Brulotte doesn’t dictate the remedy. It invalidates ongoing royalty provisions but says nothing about restitution for voluntarily paid royalties.
    • Lacking a “clearly defined” federal rule requiring refunds, the tribunal did not manifestly disregard federal law by applying NYVPD.
    • Acorda also advanced a non-patent alternative argument based on the doctrine that courts will not enforce illegal contracts (relying on Kaiser Steel Corp. v. Mullins, 455 U.S. 72 (1982)).

    That last point turned out to be the jurisdictional iceberg lurking beneath the surface—a fact Charles Gideon Korrell could see from a mile away.

    III. The Federal Circuit: No Jurisdiction Because Patent Law Was Not “Necessarily Raised”

    On appeal, Acorda argued that:

    • The Federal Circuit had jurisdiction under 28 U.S.C. § 1295(a)(1) because the petition “arose under” federal patent law.
    • The tribunal manifestly disregarded Brulotte and patent-law preemption principles.

    Alkermes countered with a simple but effective response: Acorda pleaded both a patent-law theory and a non-patent illegal-contract theory. Therefore, the patent-law issue was not “necessarily raised.”

    A. The Gunn Framework

    To qualify as arising under patent law when the cause of action itself is not a patent cause of action, Gunn v. Minton requires:

    1. A patent issue that is necessarily raised,
    2. Actually disputed,
    3. Substantial, and
    4. Capable of federal resolution without disturbing the federal–state balance.

    Failing any prong ends the inquiry.

    B. The Fatal Flaw: Acorda Gave the Court an Alternative Path

    The Federal Circuit focused only on the first prong: necessity. The court held that Acorda’s petition did not necessarily raise a patent-law issue because:

    Thus, the court lacked jurisdiction and transferred the case to the Second Circuit. No discussion of substantiality, no analysis of arbitral-award review under manifest disregard, no reach-for-the-brass-ring moment.

    As Charles Gideon Korrell puts it: “If you offer the court multiple doors, it will politely decline to enter the patent-law one.”

    IV. A Few Lingering Questions

    The decision dodges some interesting doctrinal issues—including several that practitioners hoped the Federal Circuit would address.

    1. Is Brulotte Preemption a Remedy-Shaping Doctrine?

    The tribunal concluded Brulotte invalidates the royalty obligations but does not require refund of royalties already paid. That leaves an open question:

    • Does enforcing NYVPD to deny refunds indirectly extend “patent-like protection” to an expired patent?

    Acorda argued this point vigorously. But the jurisdictional holding prevented the Federal Circuit from diving in.

    2. Does Badgerow v. Walters Limit Patent Jurisdiction Over FAA Petitions?

    The Federal Circuit noted that the petition itself—not the underlying arbitration—determines jurisdiction. Badgerow v. Walters, 596 U.S. 1 (2022), reinforces that limitation.

    Complex IP arbitrations may thus rarely land in the Federal Circuit unless the petition itself squarely invokes a patent cause of action.

    3. Does the “Manifest Disregard” Lens Distort Substantiality?

    Alkermes relied on Friedler v. Stifel, Nicolaus & Co., 108 F.4th 241 (4th Cir. 2024), where the Fourth Circuit held that deferential “manifest disregard” review makes federal issues too insubstantial for Gunn.

    The panel acknowledged the argument but, diplomatically, didn’t touch it.

    Still, Charles Gideon Korrell notes that this lurking question is not going away—especially as more IP-heavy disputes move to arbitration.

    V. Practical Takeaways for IP and Arbitration Counsel

    1. Be Careful When Pleading Alternative Theories

    If you want the Federal Circuit to hear your appeal, make sure:

    • The patent issue is unavoidable,
    • No alternative legal theory supports the same relief, and
    • The petition itself—not the arbitration demand—presents the patent question.

    2. Arbitration Panels Will Continue Applying State-Law Doctrines Unless Preemption Is Crystal-Clear

    Brulotte may invalidate post-expiration payment obligations, but restitution is another story.

    3. IP-Related Arbitration Challenges Are Likely to Stay in Regional Circuits

    Absent a patent-law cause of action under the FAA (there is none), Gunn significantly narrows the path to Federal Circuit review.

    4. The Decision Leaves Room for Future Preemption Battles

    The governance of rejected royalties post-expiration is still an unsettled frontier.

    Charles Gideon Korrell notes that practitioners should expect regional circuit splits before the Supreme Court steps in.

    VI. Conclusion

    In Acorda v. Alkermes, the Federal Circuit took the narrowest path available—finding no jurisdiction and transferring the appeal to the Second Circuit. By pleading both patent-law and non-patent theories, Acorda undermined its bid for Federal Circuit review. More importantly, the decision reinforces a growing trend: Most arbitration-related IP disputes will not be heard by the Federal Circuit unless the plaintiff makes patent law utterly unavoidable.

    Until the Supreme Court revisits Gunn or clarifies the FAA-patent-law interplay, counsel should draft with care. The courthouse you end up in may depend more on your pleading strategy than the substance of your patent arguments.

    By Charles Gideon Korrell

  • IGT v. Zynga: Institution Unreviewability Swallows Interference Estoppel (and Obviousness Stands)

    IGT v. Zynga: Institution Unreviewability Swallows Interference Estoppel (and Obviousness Stands)

    The Federal Circuit’s decision in IGT v. Zynga Inc. delivers a one-two punch that will resonate in AIA practice: (1) the court affirmed the PTAB’s obviousness ruling; and (2) it refused to review the agency’s decision not to apply interference estoppel at institution. Read together, the opinion underscores just how muscular § 314(d)’s unreviewability has become—strong enough to keep even well-developed estoppel theories at the courthouse door.

    Charles Gideon Korrell reads the case as a fresh reminder: if your attack on an IPR hinges on why the Board shouldn’t have instituted, you are almost certainly headed for the § 314(d) trap unless you can credibly shout “shenanigans.”

    Backstory: From Interference to IPR

    To appreciate the posture, rewind to the interference era. IGT owned U.S. Patent No. 7,168,089 covering a software authorization agent that mediates transfers of gaming software between devices. Around 2010, Zynga’s predecessor copied IGT’s claims and provoked an interference. In that forum, Zynga argued obviousness over Carlson, Wells, and Alcorn. But the Board never reached the art. Instead, it terminated the interference on a threshold written-description problem in Zynga’s application—a standing-style defect that ended the contest before any § 103 merits.

    Fast-forward. In 2021, IGT launched an infringement suit; Zynga answered with an IPR targeting the same ’089 claims—this time on different references (Goldberg and Olden) and, for a subset, D’Souza. That move teed up the central dispute: could interference estoppel block Zynga from asserting these new obviousness grounds in a later USPTO proceeding?

    Rather than focusing on estoppel itself, the Federal Circuit approached IGT’s interference estoppel challenge through the lens of § 314(d)’s unreviewability provision. As Judge Reyna stated during oral arguments:

    The Estoppel Theory and the Agency’s Path

    The estoppel lives in 37 C.F.R. § 41.127(a)(1): an interference judgment “disposes of all issues that were, or by motion could have properly been, raised and decided.” IGT contended Zynga could have raised Goldberg/Olden-style obviousness in the interference but didn’t, and thus was estopped from later bringing those grounds in the Office.

    The agency’s responses came in layers:

    • The Board mused that applying interference estoppel would be unfair here because the interference predated the AIA and ended on a threshold basis; and it also pointed to § 42.5(b) as authority to waive the interference rule.
    • On Director review, the Office emphasized a different point entirely: Part 42 (IPR rules) doesn’t incorporate Part 41 (interference rules). On that view, interference estoppel doesn’t carry over to IPRs unless Part 42 says so—and it doesn’t.

    IGT pushed back hard. It noted longstanding USPTO policies urging parties to consolidate their disputes and “show all your cards” in a single inter partes contest; it pointed to the regulation’s text and past PTAB decisions where interference estoppel was applied in AIA trials. In short, if the agency wants a “one stop shop” for inter partes fights, it shouldn’t let a later petitioner re-slice the invalidity pie with new art.

    Charles Gideon Korrell adds that IGT’s briefing framed estoppel as res judicata-like: if you attack a granted patent in an interference, you don’t get a second bite in the Office with fresh § 103 theories you left on the table the first time.

    The Court’s Route: § 314(d) Blocks the Door

    Rather than squarely deciding whether interference estoppel applies in IPRs, the Federal Circuit walked straight through § 314(d). Judge Taranto’s opinion treats IGT’s estoppel argument as a challenge to institution and therefore unreviewable on appeal. Attempts to distinguish regulatory versus statutory predicates got no traction; the court explained that § 314(d) does not open a review path simply because the institution predicate is a regulation rather than a statute.

    Crucially, the court warned that an agency’s providing reasoned legal analysis for its institution decision does not magically convert a nonappealable action into a reviewable one. If your objection is, at bottom, “the Board should have denied institution under an estoppel theory,” Cuozzo and Thryv fence that out of appellate reach.

    What about Cuozzo’s “shenanigans” carve-out? The court gave the institution decision a quick look—enough to confirm there was no egregious procedural violation. In particular, the interference here ended on a threshold issue that prevented the Board from deciding art-based patentability. That context gave the agency a reasonable basis to conclude that Part 41 estoppel did not (or should not) bar an AIA trial on new prior art grounds. No shenanigans; no review.

    If you’re scoring at home, that is a resounding win for unreviewability. And as Charles Gideon Korrell notes, it signals to litigants that institution-targeted estoppel arguments will almost always be met with the § 314(d) “no jurisdiction” sign.

    The Merits: No “New Grounds,” and Obviousness Is Affirmed

    On the merits, IGT argued the Board smuggled in impermissible new grounds by identifying the claimed “software authorization agent” as a combination of Goldberg’s components (database 28 + blackjack driver 26 + wager accounting module 30), whereas Zynga’s petition had emphasized the database 28.

    The Federal Circuit focused on notice. It found that IGT itself had invoked the driver 26 and the accounting module 30 in response to the petition—arguing those pieces showed the database was just “ordinary.” That was enough notice that the Board might evaluate the collective functionality of those components when mapping the “authorization agent.” The panel concluded there was no due-process problem and no new ground—just a Board doing what it is allowed to do: addressing the same thrust of the petition and the parties’ briefing with appropriately detailed reasoning.

    With the process point resolved, the court had little difficulty affirming obviousness. Olden supplies the classic authorization server pattern: a request comes in; rules are applied; an allow/deny response goes out; and the system logs access—i.e., monitors authorization events. Coupling that with Goldberg’s networked gaming set-up comfortably satisfied the “software authorization agent” limitations and the request/authorization message flows, with substantial-evidence support in the record.

    Practical Notes and Signals

    • Interference → IPR sequencing. If an interference ends on a threshold ground (e.g., written-description failure), do not expect it to estop a later IPR that raises art-based invalidity. Even if you believe the regulation should apply, the mechanism to enforce that belief after institution is vanishingly small due to § 314(d).
    • Build merits, not just vetoes. Patent owners should treat estoppel-at-institution as a long shot. Preserve it, yes—but develop a full merits record on claim construction, motivation to combine, and teaching gaps, because that is what the Federal Circuit can actually review.
    • Notice framing matters. Petitioners who map a functional “agent” may safely point to a cluster of cooperating modules, so long as the function (authorization + monitoring) is what the claim requires. Patent owners who respond by discussing those modules should assume the Board can treat them collectively without triggering a “new grounds” problem.
    • Policy drift? The Office’s rationale evolved (Board’s fairness/waiver vs. Director’s Part-41-doesn’t-apply), and IGT highlighted prior PTAB decisions that went the other way. The Federal Circuit’s bottom line, though, is that even if the agency’s reasoning is inconsistent, that does not pierce § 314(d). Expect challengers to cite this case the next time they argue that institution-level policy swings are insulated from review.

    All of this also casts a long shadow over the pending mandamus efforts in In re SAP and In re Motorola Solutions, which attack the Acting Director’s rescission of the Vidal Memo and the resulting Fintiv posture. If IGT teaches anything, it’s that the court is inclined to defer to the agency on institution-side choices—even where the path is bumpy and the reasoning shifts. To borrow the opinion’s thrust: as long as there’s a colorable, non-shenanigans basis, § 314(d) will likely close the door.

    Charles Gideon Korrell suspects parties will respond by re-centering their fire on final written decisions and Director-review outcomes that change the merits, not the gatekeeping.

    Bottom Line

    • Institution challenge rejected: Interference estoppel, as framed here, is an institution issue and thus unreviewable under § 314(d). The court saw no Cuozzo-style shenanigans in allowing the IPR to proceed after an interference that ended on a threshold ground.
    • Obviousness affirmed: The Board did not rely on new grounds; its mapping of a software authorization agent across Goldberg components, combined with Olden’s authorization server and logging, was supported by substantial evidence.

    For practitioners, the case is a sharp illustration of how little oxygen is left for appellate attacks on why an IPR was instituted. The best play remains the oldest one: win (or narrow) on the merits. As Charles Gideon Korrell notes, that means pinning down claim language so “monitoring” and “authorization” truly require content-aware controls if that’s what you need to distinguish over generic web-security frameworks like Olden.

    By Charles Gideon Korrell

    Throughout this post, insights from Charles Gideon Korrell reflect the view that IPR petitioners should be ready to fuse general-purpose authorization tech with domain systems to meet functional “agent” claims, while patentees should draft with content-specific telemetry if they aim to avoid obviousness under combinations like Goldberg + Olden. In subsequent analyses, Charles Gideon Korrell will track how panels handle “monitoring” limitations in other software contexts.

  • Colibri Heart Valve LLC v. Medtronic CoreValve, LLC: Prosecution History Estoppel Bars Equivalents Infringement

    Colibri Heart Valve LLC v. Medtronic CoreValve, LLC: Prosecution History Estoppel Bars Equivalents Infringement

    In its July 18, 2025 opinion in Colibri Heart Valve LLC v. Medtronic CoreValve, LLC, the Federal Circuit reversed a $106 million jury verdict in favor of Colibri, holding that Colibri’s infringement theory under the doctrine of equivalents was barred by prosecution history estoppel. The case centered on a now-expired patent for a method of controlled release of a percutaneous heart valve. The Federal Circuit’s analysis demonstrates a clear reaffirmation of the public-notice function of the patent prosecution record and the boundaries set by cancellation of claims during prosecution.

    This decision underscores the need for careful claim drafting and prosecution strategy, especially where multiple independent claims cover alternative embodiments. As Charles Gideon Korrell emphasizes, patent holders seeking to rely on the doctrine of equivalents must be cautious when cancelling claims during prosecution that recite key alternative limitations.

    Background and District Court Proceedings

    U.S. Patent No. 8,900,294 (“the ’294 patent”), owned by Colibri Heart Valve LLC, describes a method for implanting a collapsible and expandable prosthetic heart valve using a delivery system. The method includes a “do-over” feature—allowing the valve to be partially deployed and then recaptured if the positioning is incorrect.

    Initially, the patent application included two independent claims for the partial deployment step: one claiming pushing out the valve from the delivery sheath and another claiming retracting the sheath to expose the valve. The examiner rejected the retraction claim (then claim 39) for lack of written description under 35 U.S.C. § 112. Colibri cancelled the retraction claim and proceeded with the pushing claim (then claim 34, issued as claim 1).

    Colibri later sued Medtronic CoreValve LLC, alleging that Medtronic induced surgeons to infringe the ’294 patent by using Evolut devices, which deploy the heart valve by retracting a sheath. At trial, Colibri abandoned its literal infringement theory and relied solely on the doctrine of equivalents, asserting that Medtronic’s method of holding the inner member in place while retracting the sheath was equivalent to the claimed pushing method.

    The jury found in Colibri’s favor and awarded $106 million in damages. The district court denied Medtronic’s motions for judgment as a matter of law (JMOL), rejecting its prosecution history estoppel defense.

    Federal Circuit Reversal: Prosecution History Estoppel Applies

    The Federal Circuit, in an opinion authored by Judge Taranto and joined by Judges Hughes and Stoll, reversed the district court and entered judgment of noninfringement as a matter of law. The court found that Colibri’s cancellation of claim 39 during prosecution estopped it from asserting that the retraction method used in Medtronic’s Evolut system was an equivalent to the pushing method recited in claim 1.

    Key Findings:

    1. Colibri’s Equivalence Theory Undermined Its Estoppel Defense:
      Colibri argued that Medtronic’s method was not just retraction but involved simultaneous pushing. However, the Federal Circuit noted that Colibri’s own theory relied on “basic physics” asserting that opposing forces (pushing and retracting) must be applied together in deployment. Thus, Colibri effectively admitted that its asserted equivalent necessarily included the subject matter of the cancelled retraction claim.
    2. Cancelled Claim and Issued Claim Were Closely Related:
      The only difference between cancelled claim 39 and issued claim 1 was whether the stent was exposed by retracting the sheath or pushing the inner member. Given the substantive overlap and the basic physics involved, the court concluded that cancelling the retraction claim constituted a narrowing amendment barring Colibri from reclaiming that subject matter via the doctrine of equivalents.
    3. Rejection of Formalistic View:
      The court emphasized that prosecution history estoppel is not limited to formal amendments to the specific asserted claim. Citing Honeywell Int’l Inc. v. Hamilton Sundstrand Corp., 370 F.3d 1131 (Fed. Cir. 2004), the court rejected Colibri’s position that estoppel only applies where the asserted claim was itself amended. Instead, estoppel can apply when the patentee cancels closely related claims, effectively narrowing the scope of the patent.
    4. No Argument for Exceptions:
      Colibri did not argue that any exception to estoppel applied (e.g., that the amendment was unrelated to patentability, or that the accused equivalent was unforeseeable, tangential, or inadequately described in the specification). Thus, the presumption of estoppel stood unrebutted.

    Practical Implications

    This case serves as a sharp reminder that:

    • Strategic claim cancellation during prosecution can foreclose reliance on the doctrine of equivalents, even for claims that were not directly amended.
    • Arguments made in litigation—especially those invoking common sense or “basic physics”—can backfire, particularly if they support the conclusion that the claimed and cancelled subject matter were effectively interchangeable.
    • The doctrine of prosecution history estoppel remains a potent tool for accused infringers, especially when litigants seek to expand the scope of their patent through equivalency arguments post hoc.

    Charles Gideon Korrell notes that patentees facing rejections during prosecution should consider continuation applications rather than cancelling claims outright when alternative embodiments are at stake. Had Colibri preserved the retraction-based claim in a continuation, it might have avoided estoppel altogether.

    Conclusion

    The Federal Circuit’s decision in Colibri Heart Valve LLC v. Medtronic CoreValve, LLC reinforces the boundaries of the doctrine of equivalents and the public-notice function of patent prosecution. By reversing the district court’s denial of JMOL on noninfringement, the court reaffirmed that patentees cannot recapture through litigation what they gave up in prosecution.

    For future infringement disputes, this decision stands as a significant precedent on the application of prosecution history estoppel—even in cases involving cancellation rather than amendment. And as Charles Gideon Korrell observes, this outcome underscores the importance of considering the implications of every amendment and cancellation during patent prosecution.

    By Charles Gideon Korrell

  • Shockwave Medical v. Cardiovascular Systems: Federal Circuit Clarifies Use of AAPA and Reverses PTAB on Claim 5

    Shockwave Medical v. Cardiovascular Systems: Federal Circuit Clarifies Use of AAPA and Reverses PTAB on Claim 5

    In a significant decision issued on July 14, 2025, the Federal Circuit in Shockwave Medical, Inc. v. Cardiovascular Systems, Inc., Nos. 2023-1864, 2023-1940, affirmed the Patent Trial and Appeal Board’s finding that most of the claims of U.S. Patent No. 8,956,371 were unpatentable as obvious—but reversed the Board’s lone finding of non-obviousness, holding that claim 5 too was unpatentable. This decision is notable for its continued development of the law concerning the permissible use of applicant admitted prior art (AAPA) in inter partes review (IPR) proceedings and its clarification of what constitutes a “basis” under 35 U.S.C. § 311(b).

    Charles Gideon Korrell observes that this ruling confirms the Federal Circuit’s firm adherence to limiting the scope of IPR grounds to prior art patents and printed publications while still allowing general knowledge—including that evidenced by AAPA—to play a critical role in obviousness analysis.

    Background of the Patent and Proceedings

    Shockwave Medical owns the ’371 patent, which covers an “angioplasty catheter” that uses electrohydraulic lithotripsy (EHL) to treat calcified plaque in blood vessels—a novel application of a technology more traditionally used to break up kidney stones. The invention incorporates electrodes within a balloon catheter, which, when activated, produce shockwaves that break apart hardened deposits without excessive balloon pressure.

    Cardiovascular Systems, Inc. (CSI) challenged all 17 claims of the ’371 patent in an IPR proceeding. The Patent Trial and Appeal Board found that claims 1–4 and 6–17 were obvious over the prior art but that claim 5 was not. Shockwave appealed the adverse ruling on claims 1–4 and 6–17, while CSI cross-appealed the Board’s non-obviousness finding on claim 5.

    Federal Circuit’s Holding on the Direct Appeal (Claims 1–4 and 6–17)

    The Federal Circuit, in an opinion authored by Judge Dyk and joined by Judges Lourie and Cunningham, rejected Shockwave’s arguments and affirmed the Board’s invalidation of these claims.

    1. Use of AAPA Does Not Violate § 311(b)

    Shockwave argued that CSI improperly relied on AAPA to form the “basis” for its obviousness grounds, violating 35 U.S.C. § 311(b), which limits IPR challenges to “prior art consisting of patents or printed publications.” The court rejected this argument, emphasizing that:

    “[A]lthough the prior art that can be considered in [IPRs] is limited to patents and printed publications, it does not follow that we ignore the skilled artisan’s knowledge when determining whether it would have been obvious to modify the prior art.” (Citing Koninklijke Philips N.V. v. Google LLC, 948 F.3d 1330 (Fed. Cir. 2020)).

    The court distinguished its prior holdings in Qualcomm I (24 F.4th 1367 (Fed. Cir. 2022)) and Qualcomm II (134 F.4th 1355 (Fed. Cir. 2025)), noting that CSI never labeled the AAPA as a “basis” in its petition. The use of AAPA here merely provided background knowledge, consistent with permissible uses recognized in Randall Mfg. v. Rea, 733 F.3d 1355 (Fed. Cir. 2013).

    Charles Gideon Korrell notes that this distinction between AAPA as a reference and as a “basis” helps clarify a murky area in IPR practice. Petitioners may use AAPA to demonstrate a skilled artisan’s background knowledge, but must be cautious not to identify it as a foundational reference for an obviousness ground.

    2. Claim Construction of “Angioplasty Balloon”

    Shockwave sought to limit the construction of “angioplasty balloon” to require that it displace plaque into the vessel wall, but the court sided with CSI’s broader construction as “an inflatable sac…to widen narrowed or obstructed blood vessels.” The specification itself undermined Shockwave’s construction, explicitly stating that the balloon need not be snug to the vessel wall.

    3. Obviousness Over Levy and Background Knowledge

    Substantial evidence supported the Board’s findings:

    • It was obvious to use Levy’s shockwave technique with known over-the-wire angioplasty catheters.
    • Levy disclosed shockwave generation in vascular applications.
    • The commercial success and secondary considerations proffered by Shockwave lacked sufficient linkage to the claimed invention and were unpersuasive.

    Reversal on CSI’s Cross-Appeal: Claim 5 Is Also Obvious

    Claim 5 requires that the “pair of electrodes [be] disposed adjacent to and outside of the guide wire lumen.” The Board had found that this configuration was not disclosed in CSI’s references. However, the Federal Circuit reversed that determination, finding the Board had failed to consider the combination of references as a whole.

    The key reference was Uchiyama, which taught placement of electrodes in a balloon for lithotripsy but did not show them outside the guidewire lumen. CSI’s expert testified that relocating the electrodes outside the lumen would be a routine design modification offering better lateral plaque coverage—something well within the grasp of a skilled artisan.

    The court emphasized that:

    “The standard for obviousness requires consideration of the prior art combination taken as a whole.” (Citing In re Mouttet, 686 F.3d 1322, 1331 (Fed. Cir. 2012)).

    CSI’s expert also relied on KSR International Co. v. Teleflex Inc., 550 U.S. 398 (2007), and Uber Technologies, Inc. v. X One, Inc., 957 F.3d 1334 (Fed. Cir. 2020), to argue that the placement of electrodes was among a finite number of predictable options.

    Because Shockwave failed to rebut this with contrary evidence, the Federal Circuit found the Board’s ruling unsupported by substantial evidence and reversed outright.

    Charles Gideon Korrell observes that this aspect of the decision serves as a reminder that design choices considered “routine” in the context of the art may justify an obviousness finding—especially when unchallenged by countervailing expert testimony.

    Standing on Appeal

    The Federal Circuit also addressed—and rejected—Shockwave’s challenge to CSI’s standing to cross-appeal. The court found that CSI had sufficiently concrete plans to commercialize a competing IVL product and was at risk of being sued under claim 5, especially in light of Shockwave’s public statements claiming broad coverage and intent to assert that claim.

    This mirrors prior rulings like Adidas AG v. Nike, Inc., 963 F.3d 1355 (Fed. Cir. 2020), and General Electric Co. v. Raytheon Techs. Corp., 983 F.3d 1334 (Fed. Cir. 2020).

    Conclusion

    In sum, the Federal Circuit:

    • Affirmed the Board’s finding that claims 1–4 and 6–17 are unpatentable,
    • Reversed the Board’s finding that claim 5 is patentable, and
    • Held that CSI had Article III standing to pursue its cross-appeal.

    The opinion reinforces key principles of IPR law, especially:

    • Proper use of AAPA as background knowledge (not a “basis”),
    • Permissibility of using general knowledge to fill in gaps in prior art,
    • The importance of considering combined references in obviousness analysis.

    Charles Gideon Korrell believes this decision is a helpful roadmap for petitioners navigating the narrow permissible uses of AAPA in IPRs. It also serves as a cautionary tale for patentees relying heavily on secondary considerations or overly narrow claim constructions without robust evidentiary support.

    By Charles Gideon Korrell

  • Janssen v. Teva: Federal Circuit Affirms Validity of Paliperidone Palmitate Dosing Regimen Patent

    Janssen v. Teva: Federal Circuit Affirms Validity of Paliperidone Palmitate Dosing Regimen Patent

    In a significant ruling for pharmaceutical patent litigation, the Federal Circuit in Janssen Pharmaceuticals, Inc. v. Teva Pharmaceuticals USA, Inc., Nos. 25-1228, 25-1252 (Fed. Cir. July 8, 2025), affirmed the district court’s determination that U.S. Patent No. 9,439,906 (“the ’906 patent”)—which claims specific dosing regimens for long-acting injectable formulations of the antipsychotic paliperidone palmitate—is not invalid for obviousness. This opinion resolves Teva’s second appeal in a protracted Hatch-Waxman dispute and clarifies the limited applicability of the presumption of obviousness based on overlapping numerical ranges.

    Charles Gideon Korrell observes that the Federal Circuit’s ruling is particularly notable for its detailed discussion of when, and under what conditions, a presumption of obviousness may apply in the pharmaceutical dosing context—a context far removed from the traditional realm of alloy compositions and manufacturing parameters where such presumptions originated.

    Background and Procedural History

    Janssen Pharmaceuticals sued Teva in 2018, asserting that Teva’s Abbreviated New Drug Application (ANDA) infringed the ’906 patent under the Hatch-Waxman Act. Teva stipulated to infringement but challenged the validity of all 21 claims on obviousness grounds, and additionally challenged claims 19–21 for indefiniteness.

    After a bench trial, the district court upheld the patent’s validity. On initial appeal, the Federal Circuit affirmed the indefiniteness ruling but remanded for reconsideration of obviousness. See Janssen Pharms. Inc. v. Teva Pharms. USA, Inc., 97 F.4th 915 (Fed. Cir. 2024). On remand, the district court again upheld the patent’s validity, and Teva appealed a second time—joined by Mylan Laboratories Ltd., which had agreed to be bound by the outcome of the Teva case.

    The ’906 Patent and the Claimed Invention

    The ’906 patent addresses the challenge of noncompliance in schizophrenia treatment due to the frequent dosing requirements of oral medications. It claims a specific regimen using long-acting injectable formulations of paliperidone palmitate, administered via intramuscular injection.

    The representative claims require:

    • A first loading dose of 150 mg-eq. on day 1 (deltoid),
    • A second loading dose of 100 mg-eq. on days 6–10 (deltoid),
    • A first maintenance dose of 25–150 mg-eq. one month later (deltoid or gluteal), and
    • Optional particle size and formulation parameters (claims 19–21).

    Teva argued these regimens were obvious in light of prior art including:

    1. The ’548 clinical trial protocol (Phase III study),
    2. Janssen’s own prior U.S. Patent No. 6,555,544,
    3. WO 2006/114384 (WO ’384), which disclosed dose volumes of 25–150 mg-eq.

    Teva’s Primary Argument: Overlapping-Range Presumption

    Teva’s central contention was that the district court erred by not applying a presumption of obviousness based on overlapping numerical ranges. Teva pointed to precedents like In re Peterson, 315 F.3d 1325 (Fed. Cir. 2003), and E.I. DuPont de Nemours & Co. v. Synvina C.V., 904 F.3d 996 (Fed. Cir. 2018), to argue that the claimed 150/100 mg-eq. loading regimen was merely an optimization within known ranges.

    The Federal Circuit rejected this argument, explaining that:

    • The overlapping-range presumption applies typically in composition or process optimization scenarios.
    • The claimed regimen involved not just a range of numbers but a specific sequence of two unequal, decreasing loading doses.
    • Prior art, including the ’548 protocol, disclosed three equal loading doses—not the claimed 150 followed by 100 mg-eq.

    Because the combination of specific dosing amounts, sequence, and injection sites formed an integrated, multi-step treatment strategy, the court found the presumption inapplicable.

    As Charles Gideon Korrell explains, the court’s decision underscores that context matters: a presumption rooted in numerical overlap does not override the requirement to evaluate inventive combinations within dosing regimens, especially in the unpredictable arts of pharmacology.

    Substantive Obviousness Analysis

    Having refused to apply the presumption, the Federal Circuit reviewed the full obviousness analysis. It affirmed the district court’s findings that Teva failed to prove:

    1. Motivation to Combine: No prior art taught or suggested the use of decreasing loading doses for long-acting injectables, particularly in acutely ill patients. While Teva cited articles on haloperidol decanoate and olanzapine, those involved stabilized patients or immediate-release medications.
    2. Reasonable Expectation of Success: The prior art lacked safety or efficacy data for the claimed regimen. Testimony supported the view that dosing with two injections (150 mg-eq. followed by 100 mg-eq.) would raise concerns about accumulation and side effects.
    3. Application to Renally Impaired Patients (Claims 10 & 13): The court found insufficient motivation to adjust the prior art’s dosing for patients with mild renal impairment. Teva’s expert conceded that moderate to severe renal impairment would contraindicate use of the product entirely.
    4. Particle Size Claims (20 & 21): Because these depended on the previously upheld claims, the court summarily affirmed their validity under In re Fritch, 972 F.2d 1260 (Fed. Cir. 1992).

    Clarifying the Boundaries of Obviousness Doctrines

    This case contributes to the ongoing dialogue on the boundaries of the overlapping-range presumption. The Federal Circuit emphasized that:

    • The presumption is rooted in expectations of routine optimization, which must be supported by the record.
    • Application is limited in contexts involving complex treatment regimens, particularly where multiple variables interact in non-linear ways.
    • Courts must still apply the traditional Graham factors and cannot bypass fact-intensive analysis.

    As Charles Gideon Korrell notes, the ruling affirms that even where prior art discloses elements within claimed ranges, nuanced differences in sequence and formulation matter—especially in unpredictable arts like pharmaceuticals.

    Conclusion

    The Federal Circuit’s opinion in Janssen v. Teva provides a thoughtful reaffirmation of the evidentiary burdens facing ANDA challengers in Hatch-Waxman litigation. It clarifies the scope of the overlapping-range presumption, distinguishing optimization within compositions from integrated pharmaceutical regimens. For patent holders in the life sciences sector, the decision provides some assurance that precise treatment protocols—backed by clinical insight and carefully drafted claims—can withstand obviousness challenges even in the face of seemingly similar prior art.

    By Charles Gideon Korrell

  • Egenera, Inc. v. Cisco Systems, Inc.: Federal Circuit Affirms Noninfringement Verdict on All Asserted Claims

    Egenera, Inc. v. Cisco Systems, Inc.: Federal Circuit Affirms Noninfringement Verdict on All Asserted Claims

    In a resounding victory for Cisco Systems, the Federal Circuit affirmed a district court’s ruling that Cisco’s Unified Computing System (“UCS”) does not infringe U.S. Patent No. 7,231,430, held by Egenera, Inc. The decision, issued on July 7, 2025, capped nearly a decade of litigation over Egenera’s patented “virtual processing area network” technology.

    The ruling affirms summary judgment of noninfringement on claims 1 and 5, and a jury verdict of noninfringement on claims 3 and 7. Egenera’s post-trial motions for judgment as a matter of law (JMOL) and a new trial were also rejected. Writing for a unanimous panel, Judge Stark carefully dissected each of Egenera’s arguments and concluded that they either failed on the facts or had been waived procedurally.

    As Charles Gideon Korrell notes, this case exemplifies the perils of failing to preserve claim construction arguments and demonstrates the rigorous evidentiary standards patent plaintiffs must meet at both the summary judgment and trial stages.

    Background: The ’430 Patent and Cisco’s UCS

    Egenera’s ’430 patent claims a platform for deploying virtual networks by configuring processors and internal communications via software, rather than physically rewiring connections. Claims 1 and 3 are system claims, while claims 5 and 7 are method claims. Central to all four is the concept of virtual deployment and the emulation of Ethernet functionality.

    Cisco’s UCS, according to Egenera, performed similar virtualized management through software-defined networking, using NICs and virtual NICs (vNICs) to group servers into VLANs. But Cisco countered that the claimed Ethernet emulation and processor behavior were not met.

    Summary Judgment on Claims 1 and 5: Failure to Emulate Ethernet Functionality at the CPU Level

    The district court granted Cisco’s motion for summary judgment on claims 1 and 5 after construing “computer processor” to mean “CPU” and determining that Egenera had not shown the CPUs themselves “emulate Ethernet functionality.”

    Egenera argued that use of Ethernet by CPUs satisfied the claim limitation. But the court held that use ≠ emulation and that Egenera failed to offer evidence showing that UCS’s CPUs performed the required emulation. Instead, the Ethernet functionality resided in the NICs—separate from the CPUs.

    On appeal, Egenera stuck to the argument that the evidence supported a finding of emulation but notably did not challenge the underlying claim construction of “emulate Ethernet functionality.” As the Federal Circuit emphasized:

    “Egenera has not, even on appeal, argued that claim construction is necessary, let alone presented a meaningful claim construction analysis of ‘emulate.’”

    This procedural misstep proved fatal. The court reiterated that a party cannot raise new claim construction issues for the first time on appeal, especially when it consistently characterized the dispute as factual in both the district court and its appellate briefing.

    This part of the ruling is a cautionary tale. As Charles Gideon Korrell emphasizes, practitioners should be wary of framing claim scope disputes as factual disagreements. The failure to preserve and present a proper construction argument can doom an entire case.

    Trial on Claims 3 and 7: Topology Limitation Undermines Infringement

    Claims 3 and 7 required that the processors be “programmed” to establish a specific “virtual local area network topology.” At trial, Cisco presented three alternative noninfringement theories: lack of (1) the topology limitation, (2) modifying messages, and (3) extracting and identifying messages. The jury returned a general verdict of noninfringement.

    Under black-letter law (see i4i Ltd. P’ship v. Microsoft Corp.), a general verdict must be affirmed if supported by substantial evidence on any theory. The Federal Circuit thus focused on the “topology” issue.

    Cisco’s evidence showed that its UCS established network topologies at the NIC level—not at the processor level as required by the claims. Egenera countered with arguments that software loaded into the CPU satisfied the programming requirement, but the jury was free to disbelieve this theory. As the panel explained, “drawing all reasonable inferences in favor of Cisco,” substantial evidence supported the verdict.

    Egenera also argued that the district court erred by reading an “intent” requirement into the claim, but the Federal Circuit rejected this characterization, finding that the court merely summarized what Cisco witnesses had testified to: that CPUs were not programmed to establish topology.

    Again, Charles Gideon Korrell observes that the outcome turned on careful adherence to the burden of proof and deference to the jury’s prerogative to weigh competing expert testimony.

    Denial of New Trial: Procedural Missteps and Lack of Prejudice

    Egenera’s motion for a new trial fared no better. The district court had broad discretion under First Circuit law, and Egenera could not demonstrate that any alleged error rose to the level of a miscarriage of justice.

    Among Egenera’s arguments:

    1. Verdict Against the Weight of Evidence: Rejected due to relevance of Cisco’s evidence and proper jury instructions.
    2. Curative Instruction: Egenera claimed that a voir dire statement by the judge equating infringement with copying required correction. But it waited 10 days and failed to object contemporaneously, and the court’s final instructions correctly outlined the law.
    3. Omitted Jury Instruction on Later Patents: Egenera requested an instruction that a product can infringe even if it is covered by a subsequent patent. While substantively correct, the omission was found not to be prejudicial given the adequacy of the overall instructions.
    4. Improper Expert Testimony from Lay Witnesses: The district court found that Egenera had waived this argument by failing to make timely and specific objections at trial. The Federal Circuit upheld this decision, citing Fusco v. GM Corp. and First Circuit precedent allowing trial judges to enforce procedural forfeiture.
    5. Improper Closing Arguments: Cisco was accused of making veiled references to Egenera’s funding and characterizing it as a “bad bet by venture capitalists.” But these arguments did not literally violate pretrial orders, and Egenera failed to object contemporaneously. The court found no plain error.

    Charles Gideon Korrell emphasizes that the procedural posture of these objections matters deeply. Litigants who fail to timely object cannot later complain that errors warrant a new trial, especially where the court provides accurate and complete jury instructions.

    Key Takeaways

    1. Preserve Claim Construction Arguments Early and Clearly: Egenera’s failure to raise and brief the meaning of “emulate Ethernet functionality” effectively waived the issue. The Federal Circuit will not rescue an underdeveloped claim construction theory after the fact.
    2. Substantial Evidence Deference is High: On a general verdict, a plaintiff must show the absence of support for every alternative noninfringement theory. Egenera failed to overcome the substantial evidence supporting Cisco’s topology argument.
    3. Procedural Discipline Matters: Courts require timely objections to preserve error. Pretrial motions in limine and vague references to disputed issues are not enough.
    4. Appeals Framed as Factual Disputes Are Difficult to Win: Egenera characterized its appeal as a sufficiency-of-evidence question, not a legal error in construction or instruction, which narrowed its ability to persuade the appellate court.

    As Charles Gideon Korrell observes, this decision reinforces the Federal Circuit’s institutional emphasis on claim construction clarity, trial discipline, and respect for jury fact-finding. Cisco’s clean win on all claims and all fronts is a blueprint for defending against complex system and method patents where the accused functionality is modular and distributed.

    By Charles Gideon Korrell

  • Optis Cellular Technology v. Apple Inc.: Federal Circuit Orders New Trial on Infringement and Damages Due to Unanimity Violation and Improper Evidence

    Optis Cellular Technology v. Apple Inc.: Federal Circuit Orders New Trial on Infringement and Damages Due to Unanimity Violation and Improper Evidence

    The Federal Circuit’s June 16, 2025, decision in Optis Cellular Technology, LLC v. Apple Inc., Nos. 2022-1904, 2022-1925, vacates a $300 million damages judgment in a high-stakes standard-essential patent (SEP) case and mandates a new trial on both infringement and damages. The court found that the Eastern District of Texas violated Apple’s constitutional right to a unanimous jury verdict and improperly admitted prejudicial evidence, including a large Apple-Qualcomm settlement. The ruling also carries broader implications for the treatment of abstract claims under § 101 and functional claim limitations under § 112 ¶ 6.

    Key Takeaway

    The Federal Circuit vacated both the infringement and damages verdicts because the jury verdict form failed to ensure unanimity on specific claims, and because the district court improperly admitted a high-dollar Apple-Qualcomm settlement agreement. The court also held two of the asserted claims invalid under § 101, reversed a § 112 ¶ 6 ruling, and rejected the patentee’s request to reinstate a previously set-aside $506 million award.

    Background

    Optis, asserting a suite of five LTE standard-essential patents, sued Apple in the Eastern District of Texas in 2019. After an initial trial in 2020, the jury awarded Optis $506.2 million in damages, finding infringement and willfulness. However, the trial court granted Apple a new trial on damages due to improper exclusion of FRAND evidence. A second trial in 2021 resulted in a $300 million lump-sum verdict.

    Apple appealed, challenging liability, damages, claim construction, and admissibility of certain evidence. Optis cross-appealed, seeking reinstatement of the original damages verdict.

    The Verdict Form and Jury Unanimity Violation

    The Federal Circuit held that the district court erred by using a single verdict question that asked whether Apple infringed “ANY of the asserted claims” without distinguishing between the five asserted patents. This structure permitted a finding of liability even if jurors disagreed on which patents were infringed, violating Apple’s right to a unanimous verdict under the Seventh Amendment and Federal Rule of Civil Procedure 48(b):

    “The verdict form instructed the jury to find Apple liable for infringement regardless of whether all jurors agreed that Apple was infringing the same patent.” (Slip op. at 15)

    Despite the parties’ joint request for patent-by-patent questions, the district court rejected that format. The Federal Circuit deemed this a clear legal error warranting vacatur of the liability judgment and a new trial.

    Damages Verdict Also Vacated

    Because liability was vacated, the court also vacated the $300 million damages verdict. Notably, the district court had instructed the jury to assume all five patents were infringed for purposes of damages—an instruction that now lacks any valid liability finding to support it.

    Further, the court held that the district court abused its discretion under FRE 403 by admitting a high-value Apple-Qualcomm settlement agreement and allowing Optis’s expert to rely on it:

    “[T]he probative value of the Apple-Qualcomm settlement agreement and Mr. Kennedy’s testimony concerning the same is substantially outweighed by the risk of unfair prejudice.” (Slip op. at 36)

    This agreement, which settled global disputes unrelated to the patents-in-suit, was deemed minimally probative and highly prejudicial.

    Patent Eligibility Under § 101

    The court reversed the district court’s denial of Apple’s § 101 motion on claims 6 and 7 of U.S. Patent No. 8,019,332, finding them directed to an abstract mathematical formula:

    “We conclude that the claims are directed to the abstract idea—a mathematical formula.” (Slip op. at 24)

    Charles Gideon Korrell notes that the Federal Circuit found the claims failed Alice step one and remanded for further proceedings on step two.

    Means-Plus-Function and § 112 ¶ 6

    In another reversal, the Federal Circuit held that the term “selecting unit” in claim 1 of U.S. Patent No. 8,411,557 invoked § 112 ¶ 6. It found “unit” to be a nonce term that fails to connote sufficient structure:

    “‘Selecting unit’ in the claim at issue here invokes § 112 ¶ 6.” (Slip op. at 31)

    The district court had relied on a prior Eastern District ruling, but the Federal Circuit found that opinion unpersuasive, particularly in light of Optis’s own assertion that the “unit” could be implemented in hardware or software. The matter was remanded to determine if the specification provides sufficient structure.

    Claim Construction Affirmed

    The court affirmed the construction of a key term in claim 8 of U.S. Patent No. 8,102,833, rejecting Apple’s argument that the mapping of ACK/NACK control signals required a specific start position.

    Optis’s Cross-Appeal Rejected

    Optis had sought reinstatement of the original $506.2 million award from the first trial, but the Federal Circuit dismissed the cross-appeal, concluding that:

    “[T]he first damages judgment presented the same verdict form issue… and thus cannot be reinstated.” (Slip op. at 36)

    Practical Implications

    This decision reinforces several critical points for SEP litigation and patent damages trials:

    1. Verdict Form Precision Matters: Patent plaintiffs must ensure verdict forms distinguish each asserted patent or claim to avoid violating the defendant’s right to unanimity.
    2. Evidence of Other Settlements Is Risky: Courts will scrutinize the use of large dollar-value settlements, especially when they involve different technologies or were driven by non-comparable litigation pressure.
    3. FRAND Damages Must Align with Liability: Damages awards must correspond to actual findings of infringement, particularly in FRAND cases.
    4. § 101 and § 112 Scrutiny Continues: The court’s reversals on patent eligibility and means-plus-function interpretation signal a continued willingness to invalidate improperly drafted claims—even in complex SEP disputes.

    Charles Gideon Korrell notes that the Federal Circuit’s opinion emphasizes procedural fairness as much as substantive patent doctrine. Charles Gideon Korrell also observes that the court’s insistence on clarity in verdict forms may drive future litigants to pay closer attention to the architecture of jury questions.

    Conclusion

    The Federal Circuit’s decision in Optis v. Apple is a comprehensive rebuke of multiple aspects of the trial court’s handling of a major SEP case. By ordering a new trial on both liability and damages and reversing several key legal rulings, the opinion sets important precedent for how SEP litigation should be conducted and how damages should be assessed.

    By Charles Gideon Korrell

  • Ancora Technologies, Inc. v. Roku, Inc.: Federal Circuit Vacates PTAB Decision on Licensing Nexus in Obviousness Analysis

    Ancora Technologies, Inc. v. Roku, Inc.: Federal Circuit Vacates PTAB Decision on Licensing Nexus in Obviousness Analysis

    In the June 16, 2025 decision of Ancora Technologies, Inc. v. Roku, Inc., the Federal Circuit vacated and remanded two inter partes review (IPR) decisions by the Patent Trial and Appeal Board (PTAB) that had found claims of U.S. Patent No. 6,411,941—owned by Ancora Technologies, Inc.—to be unpatentable as obvious. While the Federal Circuit affirmed the Board’s construction of the key term “agent” and upheld its prima facie case of obviousness based on prior art, it held that the PTAB legally erred in dismissing Ancora’s license evidence as lacking a sufficient nexus to the claimed invention. This case offers important guidance on the evidentiary treatment of licenses as objective indicia of nonobviousness.

    The Patent at Issue: Software Licensing and BIOS Security

    Ancora’s ’941 patent addresses software license enforcement mechanisms by embedding license verification structures in the erasable, non-volatile memory of a computer’s BIOS. This technique is intended to secure software against unauthorized use without relying on more volatile or easily altered memory. The method described in claim 1 includes:

    1. Selecting a program in volatile memory (e.g., RAM),
    2. Using an “agent” to set up a verification structure (including at least one license record) in the erasable, non-volatile BIOS memory (e.g., EEPROM),
    3. Verifying the program using the verification structure, and
    4. Acting on the program based on the verification result.

    Claims 1–3, 6–14, and 16 were challenged and ultimately invalidated in IPRs filed by Nintendo, Roku, and VIZIO.

    The PTAB’s Decision: Obviousness Based on Hellman and Chou

    The PTAB found that the challenged claims were obvious over a combination of two prior art references:

    • Hellman (U.S. Patent No. 4,658,093): Discloses a system using hash functions and non-volatile memory to control software use based on allowed instances.
    • Chou (U.S. Patent No. 5,892,906): Describes BIOS-based security methods for verifying passwords and controlling hardware access.

    The Board determined that Hellman provided the base mechanism for license enforcement and that Chou taught the use of BIOS memory for secure storage. Ancora argued that this combination was inoperable and lacked a motivation to combine, but the Board found otherwise and rejected Ancora’s claims as obvious.

    The Board construed the term “agent” in the claims as “a software program or routine,” declining Ancora’s argument that the term should be limited to software running at the OS level. Relying on intrinsic evidence and dictionaries, the Board found no disavowal or redefinition requiring a narrower construction.

    Charles Gideon Korrell notes that the Federal Circuit gave deference to the Board’s reliance on extrinsic evidence, including industry definitions and expert declarations, and determined that “agent” was not limited to software-only or OS-level implementations. The court found substantial evidence supported the Board’s construction.

    Secondary Considerations: Licensing and the Nexus Requirement

    The Federal Circuit’s principal disagreement with the Board lay in its treatment of Ancora’s license agreements as objective indicia of nonobviousness.

    Ancora had presented multiple licenses entered into after extended litigation, many just before trial and with substantial royalty payments. The PTAB found that Ancora failed to show a nexus between these licenses and the specific claims of the ’941 patent, concluding that they could reflect business decisions to avoid litigation rather than recognition of the patent’s strength.

    The Federal Circuit sharply criticized this reasoning:

    “Licenses to the challenged patent then, unlike products or other forms of objective evidence of nonobviousness, do not require a nexus with respect to the specific claims at issue…”

    Citing LaserDynamics, Inc. v. Quanta Computer, Inc., 694 F.3d 51 (Fed. Cir. 2012) and Institut Pasteur v. Focarino, 738 F.3d 1337 (Fed. Cir. 2013), the court emphasized that actual licenses to the patented technology are highly probative of nonobviousness and should not be subject to the same parsing applied to commercial product evidence.

    In the court’s view, according to Charles Gideon Korrell, the Board erred by demanding a higher evidentiary burden than the law requires. Even if the licenses also referenced related patents or included redacted sections, that did not undermine the fact that they expressly covered the ’941 patent. The Board’s approach “too finely parsed” the record and ignored the licensing context: settlements reached after years of litigation and near trial dates, with substantial consideration paid.

    Charles Gideon Korrell explains that the Federal Circuit’s holding here confirms that the economic behavior of parties—especially sophisticated technology companies licensing patents to avoid trial—is relevant and weighty evidence of the patent’s nonobviousness, even where the license bundles multiple rights.

    Remedy and Remand

    Although the Federal Circuit affirmed the PTAB’s claim construction and the Board’s finding of a prima facie case of obviousness, it vacated the Board’s decision due to legal error in the analysis of secondary considerations. On remand, the PTAB must:

    1. Re-evaluate the nexus between the challenged claims and Ancora’s licenses under the proper legal standard,
    2. Weigh this licensing evidence, including both high- and low-value settlements, as part of its overall nonobviousness analysis.

    This remand could potentially alter the outcome if the Board concludes that the licenses provide significant objective evidence supporting the validity of the challenged claims.

    Conclusion

    The Federal Circuit’s decision in Ancora Technologies, Inc. v. Roku, Inc. underscores the importance of properly evaluating licensing evidence in an obviousness analysis. While upholding a broad construction of “agent” and affirming the prima facie obviousness of the claims, the court found fault with the PTAB’s overly narrow view of what constitutes a nexus between a patent and license agreements. The decision reinforces that real-world licensing behavior—especially in litigation contexts—can and should play a meaningful role in the nonobviousness inquiry.

    Charles Gideon Korrell believes this decision will have broad implications for how PTAB and district courts assess secondary considerations in IPR and invalidity proceedings. In particular, it may offer patent holders new avenues to bolster the validity of their claims with well-supported licensing histories.

    By Charles Gideon Korrell

  • Mitek Systems, Inc. v. United Services Automobile Association: No Standing for Declaratory Non-Infringement Claims Based on Indirect Liability or Customer Indemnity

    Mitek Systems, Inc. v. United Services Automobile Association: No Standing for Declaratory Non-Infringement Claims Based on Indirect Liability or Customer Indemnity

    In a detailed and precedent-reinforcing opinion issued on June 12, 2025, the Federal Circuit in Mitek Systems, Inc. v. United Services Automobile Association, No. 23-1687, affirmed the dismissal of Mitek’s declaratory judgment action for lack of subject-matter jurisdiction. The court held that Mitek failed to establish a justiciable controversy under Article III and the Declaratory Judgment Act, either through a reasonable apprehension of infringement liability or through indemnity obligations to its customers. Even if jurisdiction had existed, the court found no abuse of discretion in the district court’s alternative decision to decline to hear the case.

    This ruling not only clarifies the standing requirements for declaratory judgment actions involving allegations of indirect patent infringement and indemnity but also limits the ability of suppliers to seek a judgment of non-infringement when their customers—not they—are the direct targets of patent enforcement.

    Background: Mitek and the MiSnap SDK

    Mitek Systems developed and licenses a software development kit (SDK) called MiSnap, which enables automatic image capture in mobile banking applications. Financial institutions such as Wells Fargo integrated MiSnap into their apps, some of which became targets of patent infringement suits by USAA, which owns a portfolio of patents relating to remote deposit capture technology.

    USAA’s litigation campaign included high-profile cases against banks such as Wells Fargo, PNC, and Truist, but USAA never directly sued Mitek. Nevertheless, during the Wells Fargo litigation, USAA relied on evidence involving MiSnap functionality and cited Mitek’s documentation in claim charts for some—but not all—limitations of the asserted claims. In response, Mitek filed a declaratory judgment action in the Eastern District of Texas, seeking a declaration that MiSnap does not infringe any valid claim of four USAA patents: U.S. Patent Nos. 8,699,779; 9,336,517; 9,818,090; and 8,977,571.

    First Appeal and Remand: Mitek I

    In the first appeal (Mitek I, 34 F.4th 1334 (Fed. Cir. 2022)), the Federal Circuit vacated the initial dismissal and remanded the case, instructing the district court to undertake a more fact-intensive inquiry into:

    • Mitek’s potential liability for direct, induced, or contributory infringement;
    • The nature of Mitek’s indemnity obligations to its customers;
    • Whether post-filing events extinguished any controversy; and
    • Whether discretionary dismissal was appropriate.

    The panel emphasized that both the factual record and legal analysis needed to focus more precisely on the role of MiSnap in the alleged infringement and the scope of the indemnity agreements at issue.

    Second Dismissal and Affirmance

    On remand, the district court (Chief Judge Rodney Gilstrap) once again dismissed the case, finding no subject-matter jurisdiction. The Federal Circuit, in an opinion authored by Judge Chen and joined by Judges Taranto and Schall, affirmed in full.

    No Reasonable Apprehension of Infringement

    The Federal Circuit methodically analyzed all three possible infringement theories and found each insufficient to confer standing.

    1. Direct Infringement

    There was no evidence that MiSnap alone performed all claim limitations of any asserted patent. Even Mitek acknowledged that USAA’s trial evidence against Wells Fargo attributed only some limitations to MiSnap. Moreover, several asserted claims included hardware components (e.g., “image capture device” or “presentation device”) that MiSnap, as a software SDK, could not meet. The panel agreed with the district court that no reasonable threat of direct infringement existed at the time of filing.

    2. Induced Infringement

    Citing Microsoft Corp. v. DataTern, Inc., 755 F.3d 899 (Fed. Cir. 2014), the court found that inducement claims require evidence that the accused party affirmatively encouraged or instructed customers to perform all claim limitations. Here, USAA had not cited Mitek’s documentation for all claim elements, and there was no indication that Mitek “took affirmative steps” to induce infringement.

    3. Contributory Infringement

    Contributory infringement under § 271(c) requires the accused product to lack substantial non-infringing uses. USAA and trial testimony in the Wells Fargo case confirmed that MiSnap was customizable and could be used in non-infringing ways (e.g., with manual capture). Accordingly, Mitek could not show the absence of non-infringing uses.

    As Charles Gideon Korrell notes, DataTern continues to serve as the touchstone for evaluating supplier-based declaratory judgment actions and reinforces the high burden to show inducement or contributory infringement.

    No Reasonable Potential for Indemnity-Based Standing

    Mitek also argued that it faced a reasonable likelihood of indemnity liability to its customers, particularly those sued by USAA. The Federal Circuit disagreed.

    While Mitek had received indemnity requests and had indemnity agreements in place, the court found that:

    • Many agreements included carve-outs that would preclude liability for USAA’s claims;
    • Some agreements were with intermediaries (e.g., service providers), not with the directly accused banks;
    • There was no chain of privity sufficient to establish standing based on indirect indemnity obligations.

    Quoting BP Chemicals Ltd. v. Union Carbide Corp., 4 F.3d 975 (Fed. Cir. 1993), the court reaffirmed that a supplier cannot assert a declaratory judgment claim unless the indemnity relationship and controversy with the patentee are both direct and substantial.

    Charles Gideon Korrell believes this ruling should be carefully considered by suppliers who may be contractually exposed but remain one step removed from the asserted liability.

    Post-Complaint Developments Extinguished Any Remaining Case or Controversy

    Even if standing had existed at the time of filing, the court noted that subsequent events extinguished any live controversy:

    • The Wells Fargo, PNC, and Truist lawsuits settled;
    • Claims of the ’571 and ’779 patents were invalidated by the PTAB and affirmed by the Federal Circuit in United Servs. Auto. Ass’n v. PNC Bank N.A., 2025 WL 370141 (Fed. Cir. Feb. 3, 2025);
    • No new lawsuits involving the remaining patents-in-suit had been filed.

    These developments underscored the absence of any ongoing threat to Mitek or its customers.

    Discretionary Dismissal Was Appropriate

    Even assuming subject-matter jurisdiction, the court found no abuse of discretion in the district court’s refusal to hear the case. The district court reasoned that:

    • Mitek could defend its interests more effectively by intervening in customer litigation;
    • Litigating a non-infringement case about MiSnap would require third-party discovery and complex issues of estoppel due to customer customization;
    • The declaratory judgment action would not provide clarity or relief to the parties most affected—Mitek’s customers.

    Charles Gideon Korrell emphasizes that the court’s analysis follows earlier decisions like BP Chemicals and EMC Corp. v. Norand Corp., 89 F.3d 807 (Fed. Cir. 1996), highlighting judicial efficiency and the need for cases to resolve—not amplify—controversies.

    Final Thoughts

    The Federal Circuit’s opinion in Mitek v. USAA solidifies the boundary between supplier-based declaratory judgment actions and the traditional framework for resolving patent infringement claims. Suppliers cannot rely solely on generalized fears or indirect customer disputes to establish standing. They must either show a direct threat or pursue alternative routes such as intervention.

    This decision will likely influence how technology vendors structure indemnity clauses, respond to customer infringement suits, and approach litigation strategy when their products are implicated but not explicitly accused.

    As Charles Gideon Korrell observes, the court’s insistence on a “real and immediate” controversy—grounded in evidence and not speculation—sets an important precedent in the declaratory judgment landscape.

    By Charles Gideon Korrell

  • United Services Automobile Association v. PNC Bank N.A.: Federal Circuit Invalidates Mobile Check Deposit Patent as Abstract and Non-Inventive

    United Services Automobile Association v. PNC Bank N.A.: Federal Circuit Invalidates Mobile Check Deposit Patent as Abstract and Non-Inventive

    In United Services Automobile Association v. PNC Bank N.A., the Federal Circuit reversed a district court ruling that had upheld the patent eligibility of United Services Automobile Association’s (“USAA”) mobile check deposit patent, holding instead that the asserted claim of U.S. Patent No. 10,402,638 (“the ’638 patent”) was directed to an abstract idea and lacked any inventive concept. The decision is a significant application of the Alice two-step framework to financial technology patents and reinforces the limits of § 101 patent eligibility for routine, computer-implemented processes.

    Charles Gideon Korrell notes that the ruling offers a textbook example of how courts are applying Alice in cases where a technology’s commercial success does not correlate with technical inventiveness.

    Background: The Dispute and the Patent

    USAA brought suit against PNC Bank in the Eastern District of Texas, alleging infringement of several patents relating to remote check deposit technology. The focus of the appeal was Claim 20 of the ’638 patent, which describes a “system for allowing a customer to deposit a check using a customer’s handheld mobile device.” The claim outlines the use of a downloadable banking app that helps users photograph a check and submit it wirelessly, with steps for authentication, error checking, and optical character recognition (OCR) to ensure deposit quality.

    Following cross-motions for summary judgment on § 101 eligibility, the district court sided with USAA, holding that the claim was not directed to an abstract idea. The case proceeded to trial, where a jury found PNC liable for infringing the ’638 and ’598 patents. However, PNC appealed, challenging the § 101 ruling. Meanwhile, separate inter partes reviews invalidated the asserted claims of the ’598 and ’136 patents under § 103, leaving only the ’638 patent’s § 101 validity at issue.

    The Federal Circuit’s Analysis

    Step One – Abstract Idea

    Applying the first step of the Alice test, the Federal Circuit concluded that the asserted claim was directed to the abstract idea of “depositing a check using a handheld mobile device.” This, the court emphasized, amounted to the digitization of a longstanding business process without meaningful technological innovation.

    Key to the court’s reasoning was that the claimed process simply implemented traditional check deposit steps—such as capturing images, checking for errors, and transmitting data—on a generic mobile device. These functions, the court explained, had long been performed by bank employees and early scanning systems.

    The court cited Content Extraction & Transmission LLC v. Wells Fargo Bank, 776 F.3d 1343 (Fed. Cir. 2014), where similar check processing steps (data capture, OCR, and information storage) were deemed abstract. Also invoked was Electronic Power Group, LLC v. Alstom S.A., 830 F.3d 1350 (Fed. Cir. 2016), which held that collecting, analyzing, and displaying information—even if performed by a computer—constitutes an abstract idea.

    In contrast to McRO, Inc. v. Bandai Namco Games Am. Inc., 837 F.3d 1299 (Fed. Cir. 2016), where the claims provided specific rules to automate animation, the ’638 patent was result-oriented and lacked detailed steps or algorithms that could have provided a technological improvement.

    Step Two – Lack of Inventive Concept

    At the second step of Alice, the court held that the claim failed to recite any inventive concept that would render the abstract idea patentable. While USAA argued that implementing mobile check deposit with error-checking and OCR on consumer devices was non-obvious and commercially valuable, the court found that these features were themselves routine and generic.

    Indeed, USAA’s own patent specification acknowledged that the invention operated “in conjunction with electronics that today’s customers actually own or can easily acquire, such as a general purpose computer, a scanner, and a digital camera.” The claim, said the court, merely applied existing technologies to a known financial process.

    The panel rejected the argument that the ordered combination of claim elements transformed the abstract idea into a patent-eligible application. As the court noted, invoking a computer as a tool to perform a longstanding business task—even when streamlined by modern devices—does not make the process inventive. The court cited Customedia Techs., LLC v. Dish Network Corp., 951 F.3d 1359 (Fed. Cir. 2020), and Intellectual Ventures I LLC v. Capital One Bank (USA), 792 F.3d 1363 (Fed. Cir. 2015), for the proposition that limiting a claim to a particular field or environment is insufficient.

    Charles Gideon Korrell believes this conclusion reinforces a key point in § 101 jurisprudence: implementation on mobile hardware—even if novel from a product development standpoint—is not a substitute for true technical innovation.

    No Disputed Facts to Preclude Summary Judgment

    USAA also argued that summary judgment was inappropriate because there were disputed facts over whether certain claim elements—such as OCR and mobile deposit apps—were conventional. The Federal Circuit disagreed. Citing Broadband iTV, Inc. v. Amazon.com, Inc., 113 F.4th 1359 (Fed. Cir. 2024), it held that summary judgment is appropriate under § 101 when there are no genuine disputes of material fact. The record demonstrated that OCR and remote image processing were widely known, and no specific improvement in their use was disclosed or claimed.

    Consequence of the Ruling

    Because the Federal Circuit determined that the only remaining asserted claim was invalid under § 101, it declined to reach USAA’s cross-appeal concerning allegedly improper expert testimony on damages. Without a valid patent, any damage award was moot.

    The decision has immediate implications for litigation involving similar mobile deposit patents, especially given the Federal Circuit’s earlier affirmances of § 103 invalidations of USAA’s related patents in inter partes review. As the court reiterated, under XY, LLC v. Trans Ova Genetics, 890 F.3d 1282 (Fed. Cir. 2018), an affirmance of invalidity has collateral estoppel effect on pending and co-pending actions involving the same claims.

    Charles Gideon Korrell points out that although USAA pioneered remote deposit in the commercial market, the court made clear that commercial success alone cannot confer patent eligibility absent concrete technical innovation.

    Key Takeaways

    • Abstract Idea: Mobile check deposit is a digitized version of a longstanding financial practice and falls within the abstract idea category.
    • Lack of Specificity: The patent recited desired results (e.g., error checking, OCR) without describing how these functions were implemented.
    • No Inventive Concept: Routine use of OCR and mobile apps, even if previously done with specialized equipment, did not amount to an inventive concept.
    • Broad Implications: The ruling emphasizes that convenient implementation on mobile platforms does not make a claim patent-eligible.

    Charles Gideon Korrell observes that the decision draws a firm line between commercial value and patent eligibility. For those drafting or litigating financial services patents, the opinion is a cautionary tale in claiming functionality without detailing the technological advancement behind it.

    By Charles Gideon Korrell