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Federal Circuit Reaffirms De Novo Standard of Review for Claim Construction

In a long-awaited decision, the Federal Circuit ruled en banc to uphold the the de novo standard for appellate review of claim construction issues, which was previously established in another en banc decision, Cybor Corp. v. FAS Technologies, Inc. 138 F.3d 1448 (Fed. Cir. 1998).

The facts and procedural background of the case presented a prime opportunity for the Federal Circuit to revisit the question of what deference, if any, it should give to a district court’s claim constructions. During the district court proceedings, the parties disputed the meaning of “voltage means.” As per usual, the district court analyzed the patent’s intrinsic evidence relating to the claim term. However, the district court also accepted testimony from expert witnesses and the inventor. After analyzing the different types of evidence, the district court sided with the patentee and ruled that the term should be given its plain meaning, as opposed to a more specific meaning as a means-plus-function term.

Applying the non-deferential Cybor standard of review, a panel from the Federal Circuit reversed the district court’s claim construction. The panel held that the term is a means-plus-function term and required disclosure of sufficient corresponding structure in the patent specification. Based on that conclusion, the panel invalidated the claims for indefiniteness. The patentee requested rehearing, arguing that the interpretation of documents is a fundamentally factual exercise and, therefore, a district court’s interpretation of patent claims requires some deference on appeal. In this case, the patentee argued that, on a deferential review, the district court would not, or should not, have been reversed. The Federal Circuit undertook rehearing en banc for the purpose of reconsidering the standard of appellate review of claim construction.

In a sharply divided decision, the Federal Circuit confirmed the de novo standard for review of claim construction rulings, whereby the scope of the patent grant is reviewed as a matter of law. In the decision, authored by Judge Newman, the majority held that “[a]fter fifteen years of experience with Cybor, we conclude that the court should retain plenary review of claim construction, thereby providing national uniformity, consistency, and finality to the meaning and scope of patent claims.” Moreover, reversal of Cybor would require a departure from stare decisis. That, the majority held, requires Cybor to be “unworkable,” or subsequent cases to “undermine its doctrinal underpinnings,” or “a considerable body of new experience” that requires a change in law. According to the majority, none of these conditions were met.

In a dissenting opinion, judges O’Malley, Rader, Reyna, and Wallach stated that the majority decision refuses to acknowledge that claim construction, at times, requires a district court to resolve questions of fact. By so doing, the majority opinion puts itself at odds with Rule 52(a)(6) of the Federal Rules of Civil Procedure, which instructs that, on appeal, “findings of fact … must not be set aside unless clearly erroneous.” Moreover, legitimate criticisms and debate over Cybor have been widespread since it issued, and “no reasoned application of stare decisis” supports the majority’s conclusion that the Federal Circuit cannot, or should not, reverse Cybor.

District court rulings on claim construction (and appellate review of those rulings) arguably are the most important events in patent litigation. Accordingly, courts, practitioners, and commentators should be eager to see if Lighting Ballast is heard by the Supreme Court. Until then, the Federal Circuit likely will continue to vacate or modify claim construction rulings at a relatively high rate, and the debate over the standard of review likely will continue.