H-W Technology, L.C. v. overstock.com, Inc. , 758 F.3d 1329 ( 2014 )

United States Court of Appeals
for the Federal Circuit
______________________
H-W TECHNOLOGY, L.C.,
Plaintiff-Appellant,
v.
OVERSTOCK.COM, INC.,
Defendant-Appellee.
______________________
2014-1054, -1055
______________________
Appeals from the United States District Court for the
Northern District of Texas in No. 12-cv-00636, Senior
Judge A. Joe Fish.
______________________
Decided: July 11, 2014
______________________
WINSTON O. HUFF, W.O. Huff & Associates, PLLC, of
Dallas, Texas, argued for plaintiff-appellant. With him on
the brief was DEBORAH JAGAI.
JOHN H. BARR, JR., Bracewell & Giuliani LLP, of Hou-
ston, Texas, argued for defendant-appellee. With him on
the brief was CHRISTOPHER A. SHIELD.
______________________
2 H-W TECHNOLOGY, L.C. v. OVERSTOCK.COM, INC.
Before PROST, ∗ Chief Judge and O’MALLEY, Circuit
Judge. ∗∗
PROST, Chief Judge.
H-W Technology, L.C., (“H-W”) appeals from an order
of the United States District Court for the Northern
District of Texas granting summary judgment in favor of
defendant Overstock.com, Inc., (“Overstock”). Specifical-
ly, H-W challenges the district court’s holding that claims
9 and 17 of H-W’s U.S. Patent No. 7,525,955 (“’955 pa-
tent”) are invalid. We conclude that the district court
correctly held claim 17 invalid but erred to the extent it
held corrected claim 9 invalid. Because this lawsuit
involves only uncorrected claim 9, however, the judgment
in favor of Overstock is affirmed as modified.
BACKGROUND
H-W, the owner of the ’955 patent, sued Overstock, al-
leging that Overstock’s smartphone application infringed
claims 9 and 17 of the ’955 patent. Those claims relate to
an apparatus and method for performing “contextual
searches on an Internet Protocol (IP) Phone” (“IP
Phone”). ’955 patent col. 28 ll. 11–28, col. 28 l. 61–col. 29
l. 15. According to the specification of the ’955 patent,
“[a]n IP Phone is a telephone which can operate and
execute voice communication in the same way as conven-
tional telephones either via a Plain Old Telephone System
(POTS) or an IP network.” Id. col. 1 ll. 37–40.
H-W filed this suit in March 2012 and submitted in-
fringement contentions in July of that year. That Octo-
∗
Sharon Prost assumed the position of Chief Judge
on May 31, 2014.
∗∗
Randall R. Rader, who retired from the position of
Circuit Judge on June 30, 2014, did not participate in this
decision.
H-W TECHNOLOGY, L.C. v. OVERSTOCK.COM, INC. 3
ber, Overstock notified H-W that claim 9, as issued, was
missing a limitation. It was not until late May 2013 that
H-W obtained a certificate of correction from the U.S.
Patent and Trademark Office (“PTO”) and subsequently
submitted it to the district court. In the meantime, the
parties had completed their summary judgment and claim
construction briefing. A few months later, the district
court construed the claims and granted summary judg-
ment of invalidity, holding that claims 9 and 17 were
indefinite. H-W Tech., LC v. Overstock.com. Inc., 973 F.
Supp. 2d 689, 690 (N.D. Tex. 2013); J.A. 3.
H-W timely appealed. We have jurisdiction pursuant
to 28 U.S.C. § 1295(a)(1).
ANALYSIS
H-W appeals the district court’s (1) construction of
“user of said phone” and “said user”; (2) holding that claim
9 is invalid; and (3) holding that claim 17 is invalid.
Issues (1) and (3) are related in that the construction of
the disputed terms affects the invalidity analysis of claim
17. We address each issue in turn.
I. Claim Construction
H-W appeals the district court’s construction of the
claim terms “user of said phone” and “said user” to mean
“a consumer operating the IP Phone.” H-W Tech., LC v.
Overstock.com., Inc., No. 12-cv-0636, 2013 WL 5314355, at
*1 (N.D. Tex. Sept. 23, 2013) (“Claim Construction Or-
der”). H-W argues that the correct construction is “a
person or thing that uses an IP phone.” Appellant’s Br.
17.
Claim construction is a question of law that we review
without deference. Lighting Ballast Control LLC v.
Philips Elecs. N. Am. Corp., 744 F.3d 1272, 1276–77 (Fed.
Cir. 2014) (en banc); Cybor Corp. v. FAS Techs., Inc., 138
F.3d 1448, 1456 (Fed. Cir. 1998) (en banc). In construing
claims, this court relies primarily on the claim language,
4 H-W TECHNOLOGY, L.C. v. OVERSTOCK.COM, INC.
the specification, and the prosecution history. Phillips v.
AWH Corp., 415 F.3d 1303, 1314–17 (Fed. Cir. 2005) (en
banc). After considering this intrinsic evidence, a court
may also seek guidance from extrinsic evidence such as
expert testimony, dictionaries, and treatises. Id. at 1317–
18.
H-W argues that a “user of said phone” could be a
“thing.” The only significant evidence H-W supplies in
support of this contention, other than conclusory and
undeveloped citations to the specification, is a general
purpose dictionary definition of “user” as “a person or
thing that uses something.” J.A. 754.
In contrast, the district court’s construction—that
“user of said phone” is limited to a human consumer—
finds plenty of support in the claims, specification, and
extrinsic evidence. The claims, for example, reference
“said user’s contact and payment information.” ’955
patent col. 28 ll. 25–28. Contact and payment infor-
mation is not something one would expect a “thing” to
possess. And the person using the IP Phone is a consum-
er because the person is purchasing products or services.
E.g., id. col. 28 ll. 20–24 (“said user completes a transac-
tion with at least one of said merchants”).
The specification contains further support for the
proposition that a user is a person and not a thing. For
example, the user of an IP Phone could enter information
“by pressing certain areas in the screen with a finger.” Id.
col. 6 ll. 65–66. Such reference to a finger indicates that
the user is a person. Further, at times the specification
even equates “user” with “consumer.” Id. col. 16 l. 17
(“Consumers are the users of TADS client side elements
1002.” (emphasis added)); id. col. 20 ll. 35–38 (“A TA is a
relatively small hosted application that enables the user of
the VoIP agent (a consumer) to complete commercial
transactions . . . .” (emphasis added)).
H-W TECHNOLOGY, L.C. v. OVERSTOCK.COM, INC. 5
As to extrinsic evidence, the inventors testified that a
user is “whoever is operating the phone” and “the person
that’s ordering the pizza [completing the transac-
tion] . . . .” Claim Construction Order at *9. Overstock
also counters H-W’s dictionary evidence by pointing to the
general purpose Merriam-Webster dictionary which
defines “user” as “one who uses.” J.A. 751.
In sum, the only significant evidence that supports
H-W’s position is a single, arguably marginally applicable,
dictionary definition. The district court’s construction, on
the other hand, is supported by the claims themselves,
the specification, and the weight of the extrinsic evidence.
We thus affirm the district court’s construction of “user of
said phone” and “said user” to mean “a consumer operat-
ing the IP Phone.”
II. Claim 9
H-W also appeals the district court’s summary judg-
ment holding that claim 9 is indefinite and thus invalid.
Applying the law of the regional circuit, we review the
grant of summary judgment de novo. E.g., LaserDynam-
ics, Inc. v. Quanta Computer, Inc., 694 F.3d 51, 66 (Fed.
Cir. 2012). Indefiniteness is a question of law that is also
reviewed de novo. E.g., Exxon Research & Eng’g Co. v.
United States, 265 F.3d 1371, 1376 (Fed. Cir. 2001).
Claim 9, as approved by the PTO, reads as follows:
9. A method for performing contextual search-
es on an Internet Phone (IP) phone comprising the
steps of:
receiving a command to perform a contextual
search;
receiving search criteria from a user of said IP
phone;
submitting said search criteria to a server
coupled to said IP phone; and
6 H-W TECHNOLOGY, L.C. v. OVERSTOCK.COM, INC.
receiving from said server a list of merchants
matching said search criteria and infor-
mation regarding each of said merchants
in said list;
wherein said user completes a transaction with
at least one of said merchants listed with-
out the need to generate a voice call;
wherein said information received by said us-
er comprises a variety of offers, wherein
said user selects one of said variety of of-
fers associated with said one of said mer-
chants listed, wherein said selected offer
is transmitted to said one of said mer-
chants listed electronically; and
wherein said user’s contact and payment in-
formation is not transmitted to said one of
said merchants listed, wherein said user’s
contact and payment information is avail-
able to said one of said merchants listed.
J.A. 1824 (emphasis added). When the PTO issued the
patent, however, the italicized language was inadvertent-
ly omitted. As noted, in its complaint in this case H-W
asserted the uncorrected claim.
A. The District Court Properly Did Not Correct Claim 9
H-W first argues that the district court itself had au-
thority to correct the error in claim 9. A district court can
correct a patent only if, among other things, “the error is
evident from the face of the patent.” Grp. One, Ltd. v.
Hallmark Cards, Inc., 407 F.3d 1297, 1303 (Fed. Cir.
2005); see Novo Indus., L.P. v. Micro Molds Corp., 350
F.3d 1348, 1357 (Fed. Cir. 2003).
Here, the error is not “evident from the face of the pa-
tent.” Claim 9 reads coherently without the missing
limitation. Nothing in the surrounding claim language
H-W TECHNOLOGY, L.C. v. OVERSTOCK.COM, INC. 7
indicates that the limitation was missing. Although other
claims do contain the missing limitation, the inclusion of
that limitation in one claim does not necessitate, or even
fairly indicate, that the limitation should be included in
all other claims. See SRI Int’l v. Matsushita Elec. Corp. of
Am., 775 F.2d 1107, 1122 (Fed. Cir. 1985) (“It is settled
law that when a patent claim does not contain a certain
limitation and another claim does, that limitation cannot
be read into the former claim in determining either validi-
ty or infringement.”).
Failing to find support for its position in the claims,
H-W turns to the specification. Citing the italicized
portion of the following excerpt, H-W argues that the
omitted language “is clearly in the specification.” Appel-
lant’s Br. 24.
Premium listing services 1902 include, but are not
limited to, top billing (priority placement) of a
merchant’s contact information in results provid-
ed in response to an end-user query (including
multimedia content) and no-contact transactions
(allows end-user to complete a transaction with the
merchant without the need to generate a voice
call).
’955 patent col. 23 ll. 10–15 (emphasis added).
Regardless of whether this excerpt clearly contains
the missing limitation, “no-contact transactions” appear
to be optional premium listing services. See id. col. 22 ll.
14–20 (“The services may be categorized according to
baseline directory services 1901, premium listing services
1902, and advertising services 1903. A description of the
services that can be offered under each category and how
these are supported by converged communications content
distribution platform owner 1204 (FIG. 12) are described
below.” (emphasis added)). The optional nature of such
services negates any argument that such a limitation in
the claim is implied as necessary to the invention. See
8 H-W TECHNOLOGY, L.C. v. OVERSTOCK.COM, INC.
Phillips, 415 F.3d at 1323 (warning against “importing
limitations from the specification into the claims”).
The parties appear to agree that the PTO’s error is
clear on the face of the prosecution history. But this court
has already deemed evidence of error in the prosecution
history alone insufficient to allow the district court to
correct the error. See Grp. One, 407 F.3d at 1303 (“The
error here is not evident on the face of the patent. The
prosecution history discloses that the missing language
was required to be added by the examiner as a condition
for issuance, but one cannot discern what language is
missing simply by reading the patent. The district court
does not have authority to correct the patent in such
circumstances.”).
In sum, we hold that the district court did not have
authority to correct the error in claim 9 and correctly
declined to do so.
B. The District Court Correctly Did Not Consider the
Certificate of Correction
H-W also argues that the district court “failed to fac-
tor the certificate of correction in [its] determination that
claim 9 of the ‘955 Patent is indefinite and invalid.”
Appellant’s Br. 21. Certificates of correction are governed
by 35 U.S.C. § 254, which states:
Whenever a mistake in a patent, incurred through
the fault of the Patent and Trademark Office, is
clearly disclosed by the records of the Office, the
Director may issue a certificate of correction stat-
ing the fact and nature of such mistake, under
seal, without charge, to be recorded in the records
of patents. A printed copy thereof shall be at-
tached to each printed copy of the patent, and
such certificate shall be considered as part of the
original patent. Every such patent, together with
such certificate, shall have the same effect and
H-W TECHNOLOGY, L.C. v. OVERSTOCK.COM, INC. 9
operation in law on the trial of actions for causes
thereafter arising as if the same had been original-
ly issued in such corrected form. The Director
may issue a corrected patent without charge in
lieu of and with like effect as a certificate of cor-
rection.
(Emphasis added.)
Based on the plain language of the statute, this court
has specifically held that “[t]he certificate of correction is
only effective for causes of action arising after it was
issued.” Sw. Software, Inc. v. Harlequin Inc., 226 F.3d
1280, 1294–95 (Fed. Cir. 2000). Here, H-W filed this suit
before the certificate of correction issued, and neither
party has argued that this suit involves causes of action
arising after the certificate of correction issued. Indeed, it
appears that H-W never even sought to amend the com-
plaint to reflect the correction of claim 9. Thus, the
district court was correct not to consider the certificate of
correction when determining whether H-W could assert
claim 9.
C. H-W Cannot Assert Claim 9 Uncorrected
Having concluded that the district court properly did
not correct the patent claims itself or apply the certificate
of correction to this lawsuit, the question remains wheth-
er H-W should be permitted to assert claim 9 uncorrected.
At oral argument, H-W appeared to concede that it
should not be permitted to do so. Oral Argument at 2:23–
48, 5:39–6:34 available at http://oralarguments.
cafc.uscourts.gov/default.aspx?fl=2014-1054.mp3. We
agree. When, as here, a claim issues that omits a materi-
al limitation, and such omission is not evident on the face
of the patent, the patentee cannot assert that claim until
it has been corrected by the PTO. To hold otherwise
would potentially permit patentees to assert claims that
they never asked for nor rightly attained. Such a result
10 H-W TECHNOLOGY, L.C. v. OVERSTOCK.COM, INC.
would be inequitable and undermine the notice function of
patents.
We note that this holding is, in some ways, more akin
to unenforceability than invalidity—the framework gen-
erally used by the parties and the district court here. For
example, unlike invalidity, unenforceability of a patent
may be cured under certain circumstances. See, e.g.,
Morton Salt Co. v. G. S. Suppiger Co., 314 U.S. 488, 493
(1942), abrogated on other grounds by Ill. Tool Works Inc.
v. Indep. Ink, Inc., 547 U.S. 28 (2006) (“Equity may right-
ly withhold its assistance from such a use of the patent by
declining to entertain a suit for infringement, and should
do so at least until it is made to appear that the improper
practice has been abandoned and that the consequences of
the misuse of the patent have been dissipated.”).
Regardless, the district court was correct to conclude
that H-W cannot assert either the original or corrected
versions of claim 9 in this lawsuit. The judgment of the
district court in favor of Overstock and against H-W is
thus correct. Still, in order to clarify that claim 9, as
corrected, has not yet been litigated and, thus, has not
been held invalid, we strike the portion of the judgment
that holds claim 9 invalid.
III. Claim 17
Finally, H-W appeals the district court’s holding that
claim 17 is indefinite and invalid. Claim 17 is reproduced
below:
17. A tangible computer readable medium en-
coded with computer program for performing con-
textual searches on an Internet Phone (IP) phone
comprising the steps of:
receiving a command to perform a contextual
search;
H-W TECHNOLOGY, L.C. v. OVERSTOCK.COM, INC. 11
receiving search criteria from a user of said IP
phone;
submitting said search criteria to a server
coupled to said IP phone; and
receiving from said server a list of merchants
matching said search criteria and infor-
mation regarding each of said merchants
in said list;
wherein said user completes a transaction with
at least one of said merchants listed with-
out the need to generate a voice call;
wherein said information received by said us-
er comprises a variety of offers, wherein
said user selects one of said variety of of-
fers associated with said one of said mer-
chants listed, wherein said selected offer is
transmitted to said one of said merchants
listed electronically; and
wherein said user’s contact and payment in-
formation is not transmitted to said one of
said merchants listed, wherein said user’s
contact and payment information is avail-
able to said one of said merchants listed.
’955 patent col. 28 l. 61–col. 29 l. 15 (emphases added).
The district court held that the italicized limitations
were method limitations and that apparatus claim 17
thus combines two statutory classes of invention. The
rationale behind invalidating such a claim as indefinite is
that it is unclear when infringement occurs.
At oral argument, H-W essentially conceded that if we
affirmed the district court’s disputed constructions, claim
17 would indeed contain method limitations and thus be
indefinite. Oral Argument at 10:45–11:45. Having af-
firmed the district court’s construction, H-W’s concession
12 H-W TECHNOLOGY, L.C. v. OVERSTOCK.COM, INC.
applies. And H-W is correct to concede that point. As
noted by the district court, this case is very similar to two
cases, IPXL Holdings, L.L.C. v. Amazon.com, Inc., 430
F.3d 1377, 1384 (Fed. Cir. 2005), and In re Katz Interac-
tive Call Processing Patent Litigation, 639 F.3d 1303,
1318 (Fed. Cir. 2011). In each of those cases this court
held claims indefinite for combining two classes of inven-
tion.
The claim at issue in IPXL is reproduced below:
The system of claim 2 [including an input means]
wherein the predicted transaction information
comprises both a transaction type and transaction
parameters associated with that transaction type,
and the user uses the input means to either change
the predicted transaction information or accept
the displayed transaction type and transaction
parameters.
IPXL, 430 F.3d at 1384 (citation omitted). The IPXL
court reasoned as follows:
[I]t is unclear whether infringement of [the claim]
occurs when one creates a system that allows the
user to change the predicted transaction infor-
mation or accept the displayed transaction, or
whether infringement occurs when the user actu-
ally uses the input means to change transaction
information or uses the input means to accept a
displayed transaction. Because [the claim] recites
both a system and the method for using that sys-
tem, it does not apprise a person of ordinary skill
in the art of its scope, and it is invalid under sec-
tion 112, paragraph 2.
Id.
Similarly, the court in In re Katz stated:
H-W TECHNOLOGY, L.C. v. OVERSTOCK.COM, INC. 13
Like the language used in the claim at issue in
IPXL (“wherein . . . the user uses”), the language
used in Katz’s claims (“wherein . . . callers digital-
ly enter data” and “wherein . . . callers provide . . .
data”) is directed to user actions, not system ca-
pabilities.
In re Katz, 639 F.3d at 1318.
The present case falls squarely within the IPXL and
In re Katz holdings. Here, the disputed language (“where-
in said user completes . . .” and “wherein said user se-
lects . . .”) is nearly identical to the disputed language in
those cases. And, as in those cases, it is unclear here
when infringement would occur. Claim 17 is thus indefi-
nite. Accordingly, we affirm the district court’s holding
that claim 17 is invalid.
CONCLUSION
We conclude that the district court correctly construed
the claims and held claim 17 invalid. The district court
also correctly held that H-W cannot assert either the
uncorrected or corrected versions of claim 9 in this law-
suit. We thus affirm those holdings. However, for the
sake of clarity, we strike the portion of the final judgment
holding claim 9 invalid. This is to clarify that claim 9, as
corrected, has not yet been the subject of litigation and,
therefore, has not been held invalid.
AFFIRMED AS MODIFIED