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Cuozzo Speed Technologies, LLC v. Lee

Held:

1. Section 314(d) bars Cuozzo’s challenge to the Patent Office’s decision to institute inter partes review. Pp. 7–12.

(a) The text of §314(d) expressly states that the Patent Office’s determinations whether to institute inter partes review “shall be final and nonappealable.” Moreover, construing §314(d) to permit judicial review of the Patent Office’s preliminary decision to institute inter partes review undercuts the important congressional objective of giving the agency significant power to revisit and revise earlier patent grants. Past practice in respect to related proceedings, including the predecessor to inter partes review, also supports the conclusion that Congress did not intend for courts to review these initial determinations. Finally, reading §314(d) as limited to interlocutory appeals would render the provision largely superfluous in light of the Administrative Procedure Act. Pp. 7–9.

(b) The “strong presumption” favoring judicial review, Mach Mining, LLC v. EEOC, 575 U. S. ___, ___, is overcome here by these “ ‘clear and convincing’ ” indications that Congress intended to bar review, Block v. Community Nutrition Institute, 467 U. S. 340, 349. Given that presumption, however, the interpretation adopted here applies to cases in which the challenge is to the Patent Office’s determination “to initiate an inter partes review under this section,” or where the challenge consists of questions closely tied to the application and interpretation of statutes related to that determination. Cuozzo’s claim does not implicate a constitutional question, nor does it present other questions of interpretation that reach well beyond “this section” in terms of scope and impact. Rather, Cuozzo’s allegation that Garmin’s petition did not plead “with particularity” the challenge to claims 10 and 14 as required by §312 is little more than a challenge to the Patent Office’s conclusion under §314(a) that the “information presented in the petition” warranted review. Pp. 9–12.

2. The Patent Office regulation requiring the Board to apply the broadest reasonable construction standard to interpret patent claims is a reasonable exercise of the rulemaking authority granted to the Patent Office by statute. Pp. 12–20.

(a) Where a statute leaves a gap or is ambiguous, this Court typically interprets a congressional grant of rulemaking authority as giving the agency leeway to enact rules that are reasonable in light of the text, nature, and purpose of the statute. United States v. Mead Corp., 533 U. S. 218, 229; Chevron U. S. A. Inc. v. Natural Resources Defense Council, Inc., 467 U. S. 837, 842–843. Here, the statute grants the Patent Office the authority to issue regulations “governing inter partes review,” and no statutory provision unambiguously mandates a particular claim construction standard. The Patent Office’s rulemaking authority is not limited to procedural regulations. Analogies to interpretations of other congressional grants of rulemaking authority in other statutes, which themselves do not unambiguously contain a limitation to procedural rules, cannot magically render unambiguous the different language in the different statutory grant of rulemaking authority at issue. The nature and purpose of inter partes review does not unambiguously require the Patent Office to apply one particular claim construction standard. Cuozzo’s contention that the purpose of inter partes review—to establish trial-like procedures for reviewing previously issued patents—supports the application of the ordinary meaning standard ignores the fact that in other significant respects, inter partes review is less like a judicial proceeding and more like a specialized agency proceeding. This indicates that Congress designed a hybrid proceeding. The purpose of inter partes review is not only to resolve patent-related disputes among parties, but also to protect the public’s “paramount interest in seeing that patent monopolies . . . are kept within their legitimate scope.” Precision Instrument Mfg. Co. v. Automotive Maintenance Machinery Co., 324 U. S. 806, 816. Neither the statute’s language, nor its purpose, nor its legislative history suggests that Congress decided what standard should apply in inter partes review. Pp. 12–17.

(b) The regulation is a reasonable exercise of the Patent Office’s rulemaking authority. The broadest reasonable construction standard helps ensure precision in drafting claims and prevents a patent from tying up too much knowledge, which, in turn, helps members of the public draw useful information from the disclosed invention and understand the lawful limits of the claim. The Patent Office has used this standard for more than 100 years and has applied it in proceedings which, as here, resemble district court litigation. Cuozzo’s two arguments in response are unavailing. Applying the broadest reasonable construction standard in inter partes review is not, as Cuozzo suggests, unfair to a patent holder, who may move to amend at least once in the review process, and who has had several opportunities to amend in the original application process. And though the application of one standard in inter partes review and another in district court proceedings may produce inconsistent outcomes, that structure is inherent to Congress’ regulatory design, and it is also consistent with past practice, as the patent system has long provided different tracks for the review and adjudication of patent claims. The Patent Office’s regulation is reasonable, and this Court does not decide whether a better alternative exists as a matter of policy. Pp. 17–20.

793 F. 3d 1268, affirmed.

BREYER, J., delivered the opinion for a unanimous Court with respect to Parts I and III, and the opinion of the Court with respect to Part II, in which ROBERTS, C. J., and KENNEDY, THOMAS, GINSBURG, and KAGAN, JJ., joined. THOMAS, J., filed a concurring opinion. ALITO, J., filed an opinion concurring in part and dissenting in part, in which SOTOMAYOR, J., joined.

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Allied Erecting & Dismantling Co., Inc. v. Genesis Attachments, LLC

Allied Erecting and Dismantling Co., Inc. (“Allied”) appeals the United States Patent Trial and Appeal Board’s (“PTAB”) decision, on inter partes reexamination, concluding that claims 1–21 of U.S. Patent No. 7,121,489 (“the ’489 patent”) would have been obvious over German prior art reference DE 297 15 490 U1 (“Caterpillar”) (J.A. 131–44) and U.S. Patent No. 4,283,866 (“Ogawa”) (J.A. 145–51). See Genesis Attachments, LLC v. Allied Erecting & Dismantling Co., No. IPR2014-001006, 2014 WL 7274949 (P.T.A.B. Dec. 19, 2014); (PTAB decision denying rehearing) (J.A. 2–8). For the reasons set forth below, we affirm the PTAB’s decision.

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Genzyme Therapeutic Prods., Ltd. P'ship v. Biomarin Pharma., Inc.

This is an appeal from decisions of the Patent Trial and Appeal Board in two inter partes review proceedings. At the behest of petitioner Biomarin Pharmaceutical Inc. (“Biomarin”), the Board held various claims of two patents owned by Genzyme Therapeutics Products Limited Partnership (“Genzyme”) to be unpatentable as obvious. We affirm.

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SAS Inst., Inc. v. ComplementSof, LLC.

SAS Institute, Inc. filed an inter partes review (“IPR”) petition with the Patent Trial and Appeal Board (“Board”) to review the patentability of ComplementSoft’s U.S. Patent No. 7,110,936. The Board instituted an IPR proceeding on some, but not all, of the ’936 patent claims challenged in SAS’s petition. The Board ultimately found all of the instituted claims, except for claim 4, unpatentable in view of the prior art. SAS argues on appeal that the Board misconstrued a claim term and that the Board erred by not addressing in the final written decision claims SAS petitioned against, but that the Board did not institute as part of the proceeding. ComplementSoft cross-appeals two of the Board’s claim constructions. For the reasons below, we agree with the Board on all of the challenged constructions and determine that the Board did not need to address in its final written decision claims it did not institute. We also vacate the Board’s determination that claim 4 is patentable and remand so that the parties may address a new construction that the Board adopted in its final written decision after interpreting the claim differently before.

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Guthrie Healthcare Sys. v. ContextMedia, Inc.

Plaintiff, a provider of healthcare services in New York and Pennsylvania, and Defendant, a provider of digital health-related content nationwide, both appeal from the judgment of the United States District Court for the Southern District of New York (Forrest, J.), which granted limited permanent injunctive relief on Plaintiff’s claim of trademark infringement. The complaint alleged that Defendant’s trademarks were confusingly similar to Plaintiff’s trademark. The injunction, following a bench trial, prohibited Defendant from using its marks within Plaintiff’s geographic service area, but placed no restriction on Defendant’s use of its marks on the Internet or outside Plaintiff’s service area. The Court of Appeals concludes that Defendant’s trademarks are infringing, but that the current limitations placed on Defendant by the district court in the injunction were based on an incorrect standard and fail to give Plaintiff and the public adequate protection from likely confusion. The finding of liability and the grant of injunctive relief are AFFIRMED. The scope of the injunction is expanded, and the case is REMANDED for further proceedings.

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Capitol Records, LLC v. Vimeo, LLC

Defendant Vimeo, LLC, an Internet service provider, brings this interlocutory appeal on certified questions from the rulings of the United States District Court for the Southern District of New York (Abrams, J.), and Plaintiffs, who are owners of copyrights in recorded music, cross-appeal. The complaint alleges that recorded music contained in videos posted by users on the Vimeo website infringes Plaintiffs’ copyrights. The certified questions relate to the district court’s rulings on motions for partial summary judgment addressed to Vimeo’s entitlement to a safe harbor established by the Digital Millennium Copyright Act. 17 U.S.C. § 512(c). The court granted partial summary judgment to Plaintiffs as to videos containing pre-1972 recordings, ruling that § 512(c)’s safe harbor was not applicable to sound recordings fixed prior to 1972, because these were protected by state, rather than federal, copyright laws. It granted summary judgment to Defendants as to post-1972 videos not viewed by Vimeo employees, ruling that Plaintiffs could not prevail on the theory of Vimeo’s willful blindness to infringements. It denied summary judgment to either party for several videos, concluding that there was a question of material fact whether Vimeo possessed so-called “red flag” knowledge of circumstances that made infringement apparent.

We conclude that the safe harbor of § 512(c) applies to pre-1972 sound recordings; the mere fact that a video contains all or virtually all of a “recognizable,” copyrighted sound recording and was viewed in some fashion by a service provider’s employee is insufficient to prove knowledge or red flag knowledge of infringement; and Plaintiffs’ evidence was insufficient to support the imputation of knowledge to Vimeo through the theory of willful blindness.

Affirmed in part, and vacated in part, and remanded for further proceedings.

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Kirtsaeng v. John Wiley & Sons, Inc.

Held: 1. When deciding whether to award attorney’s fees under §505, a district court should give substantial weight to the objective reasonableness of the losing party’s position, while still taking into account all other circumstances relevant to granting fees. Pp. 3–11.

(a) Section 505 states that a district court “may . . . award a reasonable attorney’s fee to the prevailing party.” Although the text “clearly connotes discretion” and eschews any “precise rule or formula,” Fogerty v. Fantasy, Inc., 510 U. S. 517, the Court has placed two restrictions on that authority: First, a court may not “award[ ] attorney’s fees as a matter of course,” id., at 533; and second, a court may not treat prevailing plaintiffs and prevailing defendants differently, id., at 527. The Court also noted “several nonexclusive factors” for courts to consider, e.g., “frivolousness, motivation, objective unreasonableness[,] and the need in particular circumstances to advance considerations of compensation and deterrence,” id., at 534, n. 19, and left open the possibility of providing further guidance in the future, id., at 534–535.

This Court agrees with both Kirtsaeng and Wiley that additional guidance respecting the application of §505 is proper so as to further channel district court discretion towards the purposes of the Copyright Act. In addressing other open-ended fee-shifting statutes, this Court has emphasized that “in a system of laws discretion is rarely without limits,” and it has “found” those limits by looking to “the large objectives of the relevant Act.” Flight Attendants v. Zipes, 491 U. S. 754, 759. In accord with such precedents, this Court must determine what approach to fee awards under §505 best advances the well-settled objectives of the Copyright Act, which are to “enrich[ ] the general public through access to creative works” by striking a balance between encouraging and rewarding authors’ creations and enabling others to build on that work. Fogerty, 510 U. S., at 527, 526. Fee awards should thus encourage the types of lawsuits that advance those aims. Pp. 3–6.

(b) Wiley’s approach—to put substantial weight on the reasonableness of a losing party’s position—passes this test because it enhances the probability that creators and users (i.e., plaintiffs and defendants) will enjoy the substantive rights the Act provides. Parties with strong positions are encouraged to stand on their rights, given the likelihood that they will recover fees from the losing (i.e., unreasonable) party; those with weak ones are deterred by the likelihood of having to pay two sets of fees. By contrast, Kirtsaeng’s proposal—to give special consideration to whether a suit meaningfully clarified copyright law by resolving an important and close legal issue—would produce no sure benefits. Even accepting that litigation of close cases advances the public interest, fee-shifting will not necessarily, or even usually, encourage parties to litigate those cases to judgment. While fees increase the reward for a victory, they also enhance the penalty for a defeat—and the parties in hard cases cannot be confident if they will win or lose.

Wiley’s approach is also more administrable. A district court that has ruled on the merits of a copyright case can easily assess whether the losing party advanced an unreasonable position. By contrast, a judge may not know whether a newly decided issue will have broad legal significance. Pp. 6–10.

(c) Still, objective reasonableness can be only a substantial factor in assessing fee applications—not the controlling one. In deciding whether to fee-shift, district courts must take into account a range of considerations beyond the reasonableness of litigating positions. Pp. 10–11. 2. While the Second Circuit properly calls for district courts to give “substantial weight” to the reasonableness of a losing party’s litigating positions, its language at times suggests that a finding of reasonableness raises a presumption against granting fees, and that goes too far in cabining the district court’s analysis. Because the District Court thus may not have understood the full scope of its discretion, it should have the opportunity to reconsider Kirtsaeng’s fee application. On remand, the District Court should continue to give substantial weight to the reasonableness of Wiley’s position but also take into account all other relevant factors. Pp. 11–12.

605 Fed. Appx. 48, vacated and remanded.

KAGAN, J., delivered the opinion for a unanimous Court.

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Indacon, Inc. v. Facebook, Inc.

Following the district court’s claim construction order, Indacon, Inc. and Facebook, Inc. stipulated to noninfringement, and the district court entered final judgment in favor of Facebook. Indacon appeals, disputing the district court’s construction of several claim terms. Because the district court correctly construed the claim terms “alias,” “custom link,” “custom linking relationship,” and “link term,” we affirm.

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Warsaw Orthopedic, Inc. v. NuVasive, Inc.

This case returns to this court on vacatur and remand from the Supreme Court, “for further consideration in light of Commil USA, LLC v. Cisco Systems, Inc., [135 S. Ct. 1920 (2015)].” Medtronic Sofamor Danek USA, Inc. v. NuVasive, Inc., 136 S. Ct. 893 (2016) (Mem.). On remand, we reaffirm the district court’s judgment with respect to U.S. Patent No. 7,470,236 (“the ’236 patent”) and reinstate our earlier judgment in other respects.

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VMG Salsoul, LLC v. Ciccone

The panel affirmed the district court’s summary judgment in favor of the defendants and vacated an award of attorney’s fees on a claim that in the Madonna song Vogue, a modified version of a horn segment allegedly copied from a song known as Love Break violated the plaintiff’s copyrights to Love Break.

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