Federal Circuit Retains De Novo Standard of Review of Patent Claims to Maintain “Certainty”

bethShaw-0580editConvertedProfile-e1360002102239Featured Expert Column — Patent Law

Beth Z. Shaw, Brake Hughes Bellermann LLP

In a patent infringement case, claim construction is often a preliminary proceeding in a district court, before trial of infringement, validity, or damages. The district court establishes the metes and bounds of the claims that define a patent right. Since 1998, the U.S. Court of Appeals for the Federal Circuit has conducted de novo review of claim construction. Cybor Corp. v. FAS Techs., Inc., 138 F.3d 1448, 1454–55 (Fed. Cir. 1998) (en banc) (“Cybor”).

In a much-anticipated decision, a divided Federal Circuit confirmed that the standard of review of patent claims remains de novo. The court held in Lighting Ballast Control v. Phillips Electronics N.A. that the scope of the patent is still reviewed as a matter of law on appeal, with no deference given to a district court judge’s claim construction.

The majority opinion, authored by Judge Newman, concluded that the appellate de novo review of claim construction provides national uniformity, consistency, and finality to the meaning and scope of patent claims. The majority opinion emphasized the role of stare decisis and the court’s fifteen years of experience using this de novo standard under Cybor. The opinion stated that a departure from the standard would add new uncertainty for patent litigation.

In a somewhat unusual twist, the majority opinion includes a long set of “Remarks on the Dissent,” with graphs and data from the Administrative Office of the United States Courts. This data, according to the majority, shows a decline in the percentage of district court patent cases that have been appealed over the past 19 years. The majority included the data to rebut the dissent’s argument that the de novo standard increases the percentage of appeals.

Judge Lourie, writing in concurrence, noted additional reasons for retaining the de novo standard of review. He wrote that the Supreme Court has held that claim construction is a question for the court rather than the jury. Judge Lourie wrote that, “to appear to be cutting back from that holding by giving formal deference on so-called fact-like questions, which normally would go to the jury, to the district court judge, would seem to me to be an attempt to partially retreat from the Court’s holding, which is unwise.” He also argued that one of the purposes of the Federal Circuit was to achieve uniformity in patent law, and consistent with that goal is uniformity of interpretation in construction of patent claims.

Judge O’Malley dissented, with Chief Judge Rader and Judges Reyna and Wallach joining the dissent. Judge O’Malley wrote that construing the claims of a patent sometimes requires district courts to resolve questions of fact. The Federal Rules of Civil Procedure require all findings of fact not to be set aside unless clearly erroneous. Judge O’Malley argued that district court judges are in a better position to analyze fact-intensive inquiries relevant to claim construction. She wrote that the Cybor rule “not only undermines the authority of district judges, it compromises the decision-making process on appeal.” She noted that the court “is given free rein to interpret claim terms, but lacks the resources to do it right.”

Judge O’Malley also wrote that the majority opinion was a “surprise” and cited many previous dissents from certain judges in the majority opinion, which had suggested the court might overturn the Cybor rule in this en banc review.

In the end, the en banc court refused to overturn its own en banc precedent. Claim construction remains a purely legal question that is reviewed without any deference on appeal.

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