[00:00:00] Speaker ?:
Okay.

[00:00:47] Speaker 03:
Okay, next case, next argued case is number 15, 1263 Douglas Dynamics LLC against Buyers Products Company.

[00:00:57] Speaker 03:
Mr. Schunk.

[00:00:58] Speaker 04:
May it please the court?

[00:01:00] Speaker 04:
With the court's permission, I'd like to address three points this morning, subject of course to the questions that the court wants me to address.

[00:01:10] Speaker 04:
The first one that I would like to address is the effect of the very recent Teva versus Sando

[00:01:16] Speaker 04:
and Dow versus Nova decisions on the indefinite arguments that was made in the briefs.

[00:01:23] Speaker 04:
The second one is to discuss the argument by Douglass that essentially the entire market value rule is the default rather than being an exception to the way in which damages are calculated.

[00:01:40] Speaker 04:
And then the third point I'd like to turn to is the question of

[00:01:43] Speaker 04:
what the words of the district court in entering judgment were and what the effect of those words were in the case.

[00:01:51] Speaker 04:
Turning to the recent Teva and Dow cases, they were not cited in the briefing because they were decided after the briefing began.

[00:02:00] Speaker 04:
But both of them, I think, add strength to the indefiniteness argument that the appellant is making in this case.

[00:02:08] Speaker 01:
Both those opinions came out after your yellow brief was filed?

[00:02:12] Speaker 04:
I believe the Teba case was a few days before the yellow brief was filed, Your Honor.

[00:02:18] Speaker 04:
The Dow case definitely, the Dow case and the decision on denial of an on-banker hearing came out after the yellow brief was filed.

[00:02:29] Speaker 04:
They both make it clear that evidence about the understanding of a person of ordinary skill is central to the question of indefiniteness

[00:02:40] Speaker 04:
now that we know from the Supreme Court and the Biosig case that simply the ability to reach a construction of a claim term is not enough to guarantee that that claim term is in fact definite.

[00:02:53] Speaker 01:
What if hypothetically that the intrinsic evidence of a patent resolves the question, or the court comes to the conclusion that that resolves the question?

[00:03:04] Speaker 01:
Then what role, if any, does extrinsic evidence have to play?

[00:03:11] Speaker 04:
Your honor, that really wasn't the case here because the phrase support frame.

[00:03:15] Speaker 04:
I know it's a hypothetical though.

[00:03:17] Speaker 01:
Maybe I disagree with that.

[00:03:19] Speaker 01:
So please answer the hypothetical.

[00:03:21] Speaker 04:
I think your honor is suggesting a situation where the intrinsic evidence is so clear that persons of ordinary skill couldn't disagree as to what the meaning of the phrase was.

[00:03:33] Speaker 04:
And in that kind of situation, then it wouldn't make any sense

[00:03:37] Speaker 04:
to put on additional evidence from experts about what they believe that the claims mean.

[00:03:42] Speaker 04:
I think that it's a situation where the intrinsic evidence isn't conclusive or helpful or illuminating enough to reach an understanding of the claim terms that then there must be a turn to extrinsic evidence.

[00:03:58] Speaker 04:
So I guess a shorter answer to Your Honor's question is I can imagine some cases where the intrinsic evidence is clear and there's no need to consider any

[00:04:07] Speaker 04:
extrinsic evidence.

[00:04:08] Speaker 04:
But that wasn't this case.

[00:04:10] Speaker 04:
In this case, the phrase support frame doesn't appear in the original application.

[00:04:18] Speaker 04:
It was added during a broadening reissue.

[00:04:21] Speaker 04:
And there is really nothing in the prosecution history of the reissue application that illuminates support frame other than the statement that it is a broadening reissue and therefore

[00:04:33] Speaker 04:
we have to assume support frame means something broader than lift frame.

[00:04:38] Speaker 04:
That's the only thing that the intrinsic evidence showed.

[00:04:41] Speaker 04:
Now, what did the extrinsic evidence show?

[00:04:44] Speaker 04:
There were only two pieces of extrinsic evidence offered.

[00:04:48] Speaker 04:
One was the testimony of the inventor who said he flat out couldn't say what support frame meant.

[00:04:54] Speaker 04:
He had no idea.

[00:04:55] Speaker 04:
And the second was the testimony of the plaintiffs, Douglas's expert,

[00:05:02] Speaker 04:
who said that he thought it was very broad.

[00:05:04] Speaker 04:
He said it's not that I think it's nebulous, but it could mean just about anything.

[00:05:10] Speaker 04:
It could support just about anything.

[00:05:12] Speaker 04:
And then sort of jokingly referred to the fact that you could put a child seat on a frame, and then it would be a support frame because it was supporting a child seat in the context of a snowplow.

[00:05:22] Speaker 01:
I guess the testimony from those two individuals, neither of them were within the context of the disclosure and the actual patent, right?

[00:05:30] Speaker 01:
Those were more just

[00:05:31] Speaker 01:
questions about the phrase support frame in the abstract.

[00:05:35] Speaker 01:
And what the exercise has to be is, given the patent is an integrated legal document, you have to understand these claim terms within the context of the actual disclosure, the written description.

[00:05:48] Speaker 04:
Yes, Your Honor.

[00:05:50] Speaker 04:
But I mean, extrinsic evidence by definition doesn't appear in the prosecution history.

[00:05:55] Speaker 04:
And in this case, it was clear that these individuals were being asked the question

[00:06:00] Speaker 04:
because the defendant had asserted its indefiniteness argument, and the defendant was pursuing that very clearly in the deposition.

[00:06:08] Speaker 04:
This wasn't just an adventitious statement by either of these gentlemen.

[00:06:12] Speaker 04:
They were being asked, what does this phrase mean?

[00:06:16] Speaker 04:
And they were both, obviously, people.

[00:06:17] Speaker 02:
They were being asked, what does this phrase mean in the context of this claim in view of the specification?

[00:06:24] Speaker 04:
Well, no, that would be a legal question.

[00:06:27] Speaker 04:
I'm not even sure that would be appropriate to ask.

[00:06:30] Speaker 04:
I guess the way I would phrase it would be, what do you understand this to mean in the context of your patent?

[00:06:38] Speaker 04:
And I believe that that was the question.

[00:06:40] Speaker 04:
Not in those words, but that was the nature of the question that was put to the inventor.

[00:06:46] Speaker 04:
And clearly, that was the question put to the expert because he was opining on that very question.

[00:06:54] Speaker 04:
And so, Your Honor, we have a situation here where

[00:06:59] Speaker 04:
The only evidence that was before the court to help it make a decision about definiteness were statements by persons of ordinary skill and the art that were contrary to a finding of definiteness.

[00:07:15] Speaker 04:
The court then, nevertheless, and contrary to Nautilus, reached into the specific embodiment that is actually described in dependent claim 48 and said, well, since dependent claim 48,

[00:07:29] Speaker 04:
and the specific embodiment in the patent show headlamps on the support frame.

[00:07:34] Speaker 04:
And since headlamps, you don't want them to go up and down, then it must be that support frame can only be something that maintains a fixed relationship to the vehicle when it's attached.

[00:07:51] Speaker 01:
Well, to be fair, Mr. Court appeared to do more than that.

[00:07:54] Speaker 01:
I mean, it seemed to do a very thorough inquiry into

[00:07:58] Speaker 01:
all of the specifications citing various portions of it and noting that ultimately the way the term support frame is used in claim 45 and the way it's located in the context, it's very comparable to the lift frame language in other claims like claim one and lift frame is then described throughout the specification in very particular ways.

[00:08:24] Speaker 01:
It's lifting load, it's supporting components, it's connected to A frames and

[00:08:28] Speaker 01:
mounting frames, and through all of that, he concluded that the intrinsic evidence compels an understanding of support frame slash lift frame.

[00:08:38] Speaker 04:
Actually, Judge Chen, the district court didn't equate support frames and lift frames.

[00:08:47] Speaker 04:
He said that, in his view, support frame was broader than lift frame.

[00:08:52] Speaker 04:
And that's where the fundamental contradiction in the court's two definitions of lift frame comes.

[00:08:57] Speaker 04:
At one point, the court says support frame is a broader category that includes lift frames.

[00:09:03] Speaker 04:
And then later on, he says, well, support frames, though, have to maintain a certain relationship to the vehicle when it's clear that lift frames don't have to do that.

[00:09:14] Speaker 04:
And the proof that lift frames don't have to do that is the Blow patent, which shows a lift frame.

[00:09:20] Speaker 04:
that's lifting up the front of the plow, but it actually moves up and down.

[00:09:25] Speaker 01:
If you're looking at the disclosure of the prior art, you need to look at the disclosure of the patent itself.

[00:09:30] Speaker 01:
The patent itself describes the lift frame as having multiple attributes.

[00:09:35] Speaker 01:
One of them is during the operation of the plow, it's in a fixed position, right?

[00:09:44] Speaker 04:
Yes, but isn't the implication of that that if support frame is broader, then support frame must do more than that?

[00:09:50] Speaker 04:
That was certainly what the district court found, and the district court didn't equate lift frames and support frames, but clearly found one to be a subset of the other.

[00:10:01] Speaker 04:
That was the problem that the district court had.

[00:10:04] Speaker 02:
Setting what the district court set aside and just looking at what support frame means in light of specification, what do you make of the language in column 13 where they say that it would be desirable

[00:10:18] Speaker 02:
for the frame to be permanently fixed and that it would be necessary for the headlights to be fixed for safe and efficient plowing of snow, suggesting then that in operation the support frame or lift frame would have to be fixed.

[00:10:34] Speaker 04:
Well, Your Honor, that kind of language, it would be preferable for that sort of thing.

[00:10:40] Speaker 04:
It's the kind of language that a prosecuting, a patent prosecutor uses to set out a specific

[00:10:46] Speaker 04:
embodiment of the patent, and that's exactly what... What about necessary?

[00:10:49] Speaker 04:
I'm sorry?

[00:10:50] Speaker 02:
What about the language necessary?

[00:10:52] Speaker 02:
I understand what you're saying about desirable, but what about the language necessary?

[00:10:57] Speaker 04:
I think that that's following on.

[00:10:59] Speaker 04:
In other words, if you were to put... In other words, I think the patentee is saying, and if you were to practice that preferred embodiment, then it would be necessary that it maintained in the same position.

[00:11:12] Speaker 04:
I think that this entire part of the patent is discussing

[00:11:16] Speaker 04:
that specific embodiment.

[00:11:17] Speaker 02:
What about the summary?

[00:11:18] Speaker 02:
I mean what the district court did was really relied on the language in column three and said this is in the summary of the invention and therefore I understand this to mean that this is the invention.

[00:11:31] Speaker 02:
How do you respond to that language which again talks about how the lift frame must remain fixed to the vehicle so that during plowing and stacking of snow?

[00:11:44] Speaker 04:
I don't think there's a relationship.

[00:11:47] Speaker 04:
That it must remain fixed to the vehicle means that it has to stay connected to it.

[00:11:52] Speaker 04:
I don't think it means that it needs to stay in a fixed relationship to the vehicle.

[00:11:57] Speaker 02:
I'm sorry.

[00:11:58] Speaker 02:
I just paraphrased.

[00:12:01] Speaker 02:
It says remain fixed relative to the vehicle.

[00:12:03] Speaker 02:
I'm just asking about the language that the district court relied on.

[00:12:07] Speaker 02:
It's at column three, lines 23 through 29.

[00:12:10] Speaker 02:
And I'm wondering, you know, why isn't that enough?

[00:12:14] Speaker 02:
to support the district court's construction?

[00:12:20] Speaker 04:
Again, I think it's describing a specific embodiment.

[00:12:23] Speaker 02:
What about the fact that it's in the summary of the invention?

[00:12:26] Speaker 04:
In the what?

[00:12:26] Speaker 02:
Summary of the invention.

[00:12:30] Speaker 04:
Your Honor, I don't think that that detracts from the fact that it's describing one of the embodiments in the invention.

[00:12:39] Speaker 04:
And in fact, the patentees expert

[00:12:45] Speaker 04:
recognized that there were many things that might be supported by the support frame that wouldn't necessarily need to remain in a fixed relationship.

[00:12:56] Speaker 04:
He talked about, I believe, flags.

[00:12:58] Speaker 04:
He talked about, he actually jokingly talked about a child seat.

[00:13:03] Speaker 04:
None of those things, the district court was hung up on the fact that headlights can't go up and down.

[00:13:11] Speaker 04:
headlights don't exhaust the possible things that might be affixed to a support frame.

[00:13:17] Speaker 04:
And so the general language about... Headlights are the only things that are in the specification, right?

[00:13:22] Speaker 02:
I mean, child restraining seats aren't in the specification, flags aren't in the specification, but headlights are in the specification.

[00:13:30] Speaker 04:
Well, of course, support frame isn't in the specification either.

[00:13:33] Speaker 04:
And so it's a little bit... That's why more has to be done to figure out

[00:13:40] Speaker 04:
if we can, what support frame means.

[00:13:44] Speaker 04:
Your Honor, if I can briefly move on to one of the other points, because I see that my time is running down, and I do want to reserve a little bit of time to respond to the cross appeal if necessary.

[00:13:55] Speaker 04:
And that is that I wanted to say in addition that the words of the district court were clear, that the district court found only direct infringement.

[00:14:04] Speaker 04:
And yet, there was only a case of indirect damages

[00:14:10] Speaker 04:
indirect infringement damages put on.

[00:14:12] Speaker 04:
There was a fundamental mismatch between the type of damages that were put on and the specific kind of infringement that the court found.

[00:14:20] Speaker 04:
Now, the only way to resolve that is to, and this is the argument that Douglas makes, to say that this court, in the Douglas I opinion, must have ordered the court below to find direct infringement and ignore

[00:14:39] Speaker 04:
the all limitations rule.

[00:14:42] Speaker 04:
And yet it's clear that that isn't what this court did.

[00:14:44] Speaker 04:
The court's opinion begins by saying that the parties make plows, plow attachments to be attached to vehicles and quotes the language of the claim itself that refers to the vehicle as being one of the limitations.

[00:14:57] Speaker 04:
So it's clear that this court understood that in order to award damages against buyers for sale of

[00:15:08] Speaker 04:
for the sale of the attachment, there would have to be proof of indirect infringement.

[00:15:13] Speaker 04:
And yet, the district court found only direct infringement because of a lack of any proof.

[00:15:20] Speaker 04:
In fact, a lack of any proof in the face of the district court actually telling the plaintiff that it had not presented any evidence and giving them an opportunity in the rebuttal case to put on some kind of evidence that would support

[00:15:34] Speaker 04:
indirect infringement and the plaintiff choosing not to do that.

[00:15:38] Speaker 04:
That fundamental mismatch means that at a minimum this case needs to go back as the Embrax case sent its case back for a mismatch.

[00:15:50] Speaker 01:
Cross motions for summary judgment on infringement and non-infringement many, many years ago, right?

[00:15:56] Speaker 01:
Yes.

[00:15:57] Speaker 01:
And initially the district court granted non-infringement to you, right?

[00:16:04] Speaker 01:
Yes.

[00:16:05] Speaker 01:
At that time, that was the time for all parties to put all their cards on the table, right?

[00:16:11] Speaker 01:
To identify any and all elements for why or rationales for why you don't infringe and likewise for the other side, the other team to explain all the reasons why you do infringe under whatever infringement theory they want to go with.

[00:16:26] Speaker 01:
And at that time, what you were pitching was the connected to language.

[00:16:33] Speaker 01:
Yes.

[00:16:35] Speaker 01:
bring up the vehicle.

[00:16:36] Speaker 04:
Yes, we did, Your Honor.

[00:16:38] Speaker 04:
At page 19 in the yellow brief, I have a section that discusses why there was no waiver.

[00:16:45] Speaker 04:
And I would refer the court to that in detail.

[00:16:47] Speaker 04:
But in the short form, answer is that in the papers responding to the section, first of all, Douglas admitted that its claim against us on those particular claims of the patent was for indirect infringement.

[00:17:00] Speaker 04:
And it admitted.

[00:17:01] Speaker 01:
You also have an additional problem.

[00:17:04] Speaker 01:
We have law of the case, don't we, where we have this court having already announced that there weren't any other arguments raised and that therefore you directly infringe claim 45.

[00:17:22] Speaker 04:
But the court didn't say that.

[00:17:23] Speaker 04:
The court said that the accused products infringe.

[00:17:27] Speaker 04:
That was the actual words of the opinion.

[00:17:30] Speaker 04:
That isn't saying that we directly infringe or that we indirectly infringe.

[00:17:35] Speaker 04:
It's saying that the accused products infringe.

[00:17:37] Speaker 04:
And the accused products in the context of the all limitations rule, the accused products, it clearly refers to the plows when they're placed on a vehicle.

[00:17:49] Speaker 04:
That was the accused product.

[00:17:52] Speaker 04:
Plow placed on the vehicle because that's even what Douglas described the accused products to be.

[00:17:58] Speaker 04:
In recognizing that

[00:18:00] Speaker 04:
that their only claim against us here that would go to the actual sale of the product was an indirect infringement claim.

[00:18:07] Speaker 04:
So since that was clear below, it wasn't even disputed below.

[00:18:13] Speaker 04:
It came up to this court.

[00:18:15] Speaker 04:
It wasn't really argued to this court, but it was an obvious point that we don't sell cars.

[00:18:21] Speaker 04:
We don't sell trucks.

[00:18:23] Speaker 04:
The court did not specifically say that there was

[00:18:27] Speaker 04:
know that there was direct infringement.

[00:18:30] Speaker 04:
It just talked about whether the products, when attached to the trucks, met all of the limitations of the claim.

[00:18:38] Speaker 04:
That was an issue that Judge Connolly should have allowed us to take up when the case was sent back for remand.

[00:18:45] Speaker 04:
Just like the doctrine of equivalence was not waived by Exxon in the Exxon case that we cite.

[00:18:52] Speaker 01:
Is there any use for these snow plow assemblies other than mounting them on the front of a vehicle?

[00:18:58] Speaker 01:
No, Your Honor.

[00:19:00] Speaker 03:
OK.

[00:19:01] Speaker 03:
OK.

[00:19:01] Speaker 03:
Thank you.

[00:19:02] Speaker 03:
We'll save you a rebuttal time, Mr. Schunk.

[00:19:07] Speaker 03:
Help me pronounce your name.

[00:19:09] Speaker 00:
Good morning, Your Honors.

[00:19:10] Speaker 00:
I am Aaron Olenichek, and I represent Douglas Dynamics.

[00:19:16] Speaker 00:
May it please the Court.

[00:19:18] Speaker 00:
Your Honors, I'd like to first address this issue of buyers trying to recast our recent trial on damages as a trial.

[00:19:27] Speaker 00:
on infringement.

[00:19:30] Speaker 00:
There was no need to address any infringement issue at the most recent trial.

[00:19:34] Speaker 00:
That issue had, as you recognize Judge Shen, been already decided by this court.

[00:19:40] Speaker 00:
The Douglas 1 mandate already ruled that the accused products meet every limitation of claims 45.

[00:19:48] Speaker 00:
Buyers' arguments on the truck limitation, on Sientaer, on indirect infringement are incorrect, they're moot, and they're untimely.

[00:19:57] Speaker 00:
Byers failed to argue non-infringement of the truck limitation at any point in the first appeal or on summary judgment before that appeal.

[00:20:07] Speaker 00:
And this court acknowledged that in the first Douglas decision.

[00:20:10] Speaker 00:
And I quote, Byers has not presented any other arguments against infringement of claim 45.

[00:20:16] Speaker 00:
Accordingly, this court finds that the accused products meet every limitation of claim 45 as properly construed.

[00:20:24] Speaker 00:
Therefore, this court directs the district court to enter

[00:20:27] Speaker 00:
summary judgment of infringement in favor of Douglas.

[00:20:30] Speaker 00:
And this is 717F3D at 1340.

[00:20:34] Speaker 00:
There's nothing about indirect or direct infringement.

[00:20:38] Speaker 00:
There's just the decision that this court found that the accused products meet every limitation.

[00:20:44] Speaker 00:
So Byers' decision not to raise these arguments in the first appeal was consistent with and dictated by its summary judgment positions in that first trial.

[00:20:57] Speaker 00:
Douglas moved for summary judgment of infringement asserting that to the extent the entire assembly was used by an end user, Byers was nonetheless liable as an indirect infringer.

[00:21:09] Speaker 00:
In opposition, Byers only argued that the accused products did not have the A frame directly connected to the support frame, a position that this court rejected on appeal.

[00:21:21] Speaker 00:
Douglas never acknowledged that there was no infringement based on sales by Byers Products Company.

[00:21:28] Speaker 00:
Now, in its briefing, Byers points to the drug appendix at 2860 and 61, but that doesn't discuss sales at all.

[00:21:36] Speaker 00:
What it explains is that in the course of a sale of a distributor, if a distributor mounts that assembly to the vehicle, that would be direct infringement by Byers Products because the distributor is an agent of Byers Products.

[00:21:52] Speaker 00:
But this wasn't all factually developed because Byers

[00:21:56] Speaker 00:
did not dispute the indirect infringement facts until 2013.

[00:22:00] Speaker 00:
They didn't raise the Sientra issue until 2013.

[00:22:04] Speaker 00:
It was all too late for them to raise this.

[00:22:08] Speaker 00:
Now, Mr. Sharpe referred to Bayer's yellow brief.

[00:22:13] Speaker 00:
And what Bayer's does in their yellow brief is they resort to certain findings of fact at the first summary judgment.

[00:22:20] Speaker 00:
But that doesn't save the day.

[00:22:22] Speaker 00:
What those findings of fact say is that

[00:22:27] Speaker 00:
they don't contributory infringe because they don't directly infringe.

[00:22:31] Speaker 00:
And I can refer the court to the Joint Appendix at 4202 to 07 for that argument.

[00:22:38] Speaker 00:
Bias shouldn't be allowed a free pass.

[00:22:41] Speaker 00:
Seventh Circuit Summary Judgment Law, which is controlling here, does not permit a movement to delay pointing out claim flaws in the plaintiff's prima facie case.

[00:22:51] Speaker 00:
And the site for that is CNN Corporation v. Kane, 756,

[00:22:56] Speaker 00:
F3D 1024 at 1026, a recent Seventh Circuit case in 2014.

[00:23:02] Speaker 00:
Again, buyers should not be allowed a free pass on this.

[00:23:05] Speaker 00:
Buyers presented no evidence, no arguments on indirect infringement at the time it was supposed to brief it.

[00:23:12] Speaker 00:
The responses to all the findings on the 700 patent do not say anything about the Sianto argument at all.

[00:23:21] Speaker 00:
Here, too, the Seventh Circuit law outlined in CNN

[00:23:24] Speaker 00:
C and N Corporation explains that vague statements in a statement of fact do not preserve arguments.

[00:23:31] Speaker 00:
And that's also at 1026 of that case.

[00:23:34] Speaker 00:
So at the recent damages trial, infringement was a decided issue.

[00:23:40] Speaker 00:
Per the district court's February 13, 2014 order, the infringement arguments are moot in light of this court's ruling on infringement.

[00:23:50] Speaker 00:
And that's why the entire trial was dedicated to damages.

[00:23:53] Speaker 00:
And this fact that Mr. Schunk continues to raise that the district court reverted to the issue in the middle of trial and asked Douglas if it wanted to expand the trial did not change anything.

[00:24:05] Speaker 00:
And that's indicated by the post-trial order in the joint appendix at 13 to 14 and at our red brief at page 32.

[00:24:15] Speaker 00:
Douglas didn't refuse or waive any ability to put on an indirect infringement of the 2014 trial.

[00:24:22] Speaker 00:
There was no problem that needed to be fixed.

[00:24:24] Speaker 00:
The district court already ruled on summary judgment that Douglas Dynamics was entitled to damages on all sales because all sales were infringements.

[00:24:34] Speaker 00:
In fact, if we look at the joint appendix and the discussion by the court on this issue, that's at 97-51 to 52 and 97-58 to 62.

[00:24:49] Speaker 00:
The court really didn't even understand what Byers was advocating at that point.

[00:24:54] Speaker 00:
Douglas explained to Byers that the standard it was advocating for indirect infringement, it's hoped to get this back into the case, was actually incorrect.

[00:25:05] Speaker 00:
The court then asked if we wanted to put on any evidence.

[00:25:10] Speaker 00:
We said it wasn't necessary.

[00:25:12] Speaker 00:
And we reserved our ability to address it in post-trial briefing.

[00:25:16] Speaker 00:
And that's exactly what happened.

[00:25:18] Speaker 00:
It was addressed in post-trial briefing, and the court decided that it was all too late.

[00:25:25] Speaker 00:
And also, as the judges have known, the arguments are legally flawed.

[00:25:32] Speaker 00:
The arguments based on global tech are flawed because buyers knew about the 700 patent.

[00:25:39] Speaker 00:
There's ample evidence on that knowledge.

[00:25:42] Speaker 00:
And also because there are no non-infringing uses for the product.

[00:25:46] Speaker 00:
So intent may be inferred for contributory infringement if there are no non-infringing uses, and that's the RICO versus quantum computer case.

[00:25:54] Speaker 02:
Can I direct your attention to the construction of support frame?

[00:25:59] Speaker 02:
And specifically, my question is with the district court in requiring that the support frame be fixed relative to the vehicle.

[00:26:10] Speaker 02:
Why wasn't that improperly reading in limitations from the specification?

[00:26:16] Speaker 00:
It was not improper because the court was deciding what the claim language support frame means.

[00:26:27] Speaker 00:
It was asked by buyers to look at that claim language relative to the prior art.

[00:26:36] Speaker 00:
And in analyzing that language,

[00:26:38] Speaker 00:
it looked at the specification to understand what the language support frame means.

[00:26:44] Speaker 00:
And it understood, as you well noted Judge Stoll, that the summary of the invention indicates that the lift frame also recognizes being equivalent to the support frame.

[00:26:57] Speaker 02:
I'm sorry for interrupting you, but didn't the district court also just say, and I'm very familiar, obviously, with the patent.

[00:27:02] Speaker 02:
I've read the whole thing.

[00:27:05] Speaker 02:
The district court also said that the term support frame is broad, and it is.

[00:27:10] Speaker 02:
It's a broad term.

[00:27:11] Speaker 02:
Frame is something that one of ordinary scale and the art would certainly understand.

[00:27:16] Speaker 02:
But there's nothing in the claim that says fixed.

[00:27:19] Speaker 02:
There's nothing that suggests fixed.

[00:27:21] Speaker 02:
Why should we go to the specification to figure out what that word means when the word support frame is just something particularly in mechanical arts that is just not so hard to understand?

[00:27:34] Speaker 00:
as with any claim language where there is a dispute.

[00:27:38] Speaker 00:
And certainly, the dispute here at first, raised by Byers, is that the claim language is indefinite.

[00:27:44] Speaker 00:
And the court first determined that the claim language was not indefinite.

[00:27:47] Speaker 00:
And then, in the context of looking at the claim language relative to the prior arch, it said, well, does this prior arch include a support frame?

[00:27:58] Speaker 00:
And in particular, in reference to the Blau patent.

[00:28:04] Speaker 00:
In addition to that language in the summary of the invention, where it talks about being fixed to the patent, it also looked at the background of the patent.

[00:28:11] Speaker 00:
And there, in the background, the patent explains that the types of assemblies of blou are certainly different than the type of blou being claimed in the patent.

[00:28:29] Speaker 00:
And that's at column one, lines 44 to 55.

[00:28:34] Speaker 00:
the claims were not meant to cover something like the Blau bell crank assembly and the specification distinguishes it.

[00:28:43] Speaker 00:
And so the court looked at all of that intrinsic evidence and said, well, if the claims are not meant to cover something like Blau, then

[00:28:51] Speaker 00:
What does support frame mean?

[00:28:54] Speaker 00:
It also looked at the summary invention and said, well, it says that it needs to be fixed to the vehicle.

[00:28:59] Speaker 00:
That's different than what BLOW does.

[00:29:01] Speaker 02:
Does it have to be fixed to the vehicle?

[00:29:03] Speaker 02:
When I read this, I see the part you're referring to right below it.

[00:29:06] Speaker 02:
It talks about how it's important to have it fixed to the vehicle to stack the snow.

[00:29:11] Speaker 02:
Am I understanding that correctly?

[00:29:12] Speaker 00:
I'm sorry.

[00:29:13] Speaker 02:
Does it say that it's important that the frame be fixed to the vehicle in order to stack the snow?

[00:29:19] Speaker 02:
or that the prior art doesn't teach this ability to stack the snow because of the lack of being fixed to the vehicle relative to the vehicle?

[00:29:27] Speaker 00:
So yes, it's this idea that having a lift frame that is fixed to the vehicle allows for the leverage of the plow, the front of the plow blade to be lifted up higher and to stack the snow.

[00:29:42] Speaker 00:
And you don't get that same advantage without having this larger

[00:29:48] Speaker 00:
support frame or lift frame.

[00:29:50] Speaker 00:
And that's why this patent is so different than the Blau patent.

[00:29:55] Speaker 00:
Now, I would like to address a couple of points that Mr. Shank raised on the Dow Chemical and the Chiva cases, two recent cases.

[00:30:06] Speaker 00:
It's Douglas's position that those recent cases do not in any way alter the Nautilus standard.

[00:30:13] Speaker 00:
The Nautilus standard is that for indefiniteness that the claims must be read

[00:30:18] Speaker 00:
in light of the specification and the prosecution history, and that if they fail to inform with reasonable certainty those skilled in the art about the scope of the invention, then they're invalid.

[00:30:29] Speaker 00:
Well, what Tiva said is, well, that needs to be reviewed for clear error.

[00:30:35] Speaker 00:
And what Dow said is, and particularly the in-bond decision, the denial of the in-bond decision for Dow, said that, yes, Nautilus is right,

[00:30:47] Speaker 00:
You can look at extrinsic evidence, but it's not absolutely necessary.

[00:30:52] Speaker 00:
And here, we believe that is the case.

[00:30:56] Speaker 00:
The specification seems to be quite clear that a support frame is exactly what it's claimed to be, something that provides the same qualities of the lift frame.

[00:31:13] Speaker 00:
but also is capable of supporting additional features such as a light as explained in claim 48.

[00:31:21] Speaker 00:
The idea that the testimony of Mr. Watson or of Dr. Garris somehow overrides the clarity provided by the intrinsic evidence was rejected by the district court and the

[00:31:40] Speaker 00:
In fact, Dr. Garris did testify that the term was definable and indeed he said it was a broad term, but he had an entire declaration explaining that that claim language was definite.

[00:31:55] Speaker 01:
Is it your view that support frame is essentially the same as lift frame?

[00:32:01] Speaker 01:
The only thing described in the spec is lift frame.

[00:32:04] Speaker 01:
Correct.

[00:32:05] Speaker 01:
And it helps you if

[00:32:07] Speaker 01:
you tell me that support frame means the same thing as lift frame.

[00:32:10] Speaker 01:
If you tell me that, well, support frame can mean a lot of things and maybe among those things that it can mean also is a lift frame as specifically described and explained in the specification.

[00:32:24] Speaker 00:
I think they're interchangeable.

[00:32:26] Speaker 00:
I think a lift frame and a support frame is interchangeable.

[00:32:29] Speaker 00:
I think the only difference is that

[00:32:31] Speaker 00:
you have in claim 48, which is a dependent claim to claim 45, the idea that the lights are supported on the support frame.

[00:32:40] Speaker 01:
Isn't the lift frame described as supporting components such as lights, light fixtures?

[00:32:50] Speaker 01:
Absolutely.

[00:32:51] Speaker 01:
A headlamp is?

[00:32:53] Speaker 01:
Yes.

[00:32:53] Speaker 00:
I still don't see any daylight between the two.

[00:32:58] Speaker 00:
Your Honor, I submit that there is very little, if any, daylight between the two.

[00:33:02] Speaker 00:
I would say lift frame and support frame are interchangeable.

[00:33:05] Speaker 00:
In fact, that's what this court recognized in Douglas 1.

[00:33:08] Speaker 00:
This is at the joint appendix at 68-99 and the first Douglas decision at page 5.

[00:33:15] Speaker 00:
What this court said is that in the buyer's accused products, the A frame connects to the support frame, which in turn connects to the mounting frame, and then provides a figure in the

[00:33:28] Speaker 00:
in the opinion itself pointing to what the support frame is.

[00:33:32] Speaker 00:
And the support frame is, as you mentioned, exactly the same as the lift frame.

[00:33:39] Speaker 00:
Now, I would like to turn to one of our cross-appeal issues, and that is this issue of prejudgment interest.

[00:33:50] Speaker 00:
The district court did properly conclude that Douglas was entitled to prejudgment interest.

[00:33:58] Speaker 00:
The district court erred by not awarding prejudgment interest at the prime rate.

[00:34:05] Speaker 00:
And the reasoning for this, for their error, becomes clear through a Seventh Circuit case which governs this.

[00:34:14] Speaker 00:
And it's the matter of the oil spilled by the Amoco Cadiz 954 F2D 1279 at 1332.

[00:34:19] Speaker 02:
Why does the Seventh Circuit's law apply?

[00:34:23] Speaker 02:
Why doesn't this court's law apply since we're looking at, since the district court was looking at,

[00:34:28] Speaker 02:
Section 284 in awarding prejudgment interest.

[00:34:33] Speaker 00:
Well, I believe, Your Honor, that this Court has consistently looked to the law of the circuits when they are ascertaining what prejudgment interest is unless there is some departure from

[00:34:52] Speaker 00:
from the pre-judgment, from the law of the regional circuit.

[00:34:59] Speaker 02:
Can you tell me a case that specifically says that?

[00:35:02] Speaker 00:
I cannot tell you a case that specifically says that, but I can tell you that the Seventh Circuit precedent that we rely on here is consistent with, for example, the Uniroyal B. Rudkin-Wiley Corp.

[00:35:14] Speaker 00:
case, 939F2D at 1540, which says that

[00:35:22] Speaker 00:
It says that the court may award interest at or above the prime rate.

[00:35:28] Speaker 02:
Well, what about Datascope?

[00:35:30] Speaker 00:
I'm sorry?

[00:35:31] Speaker 02:
Datascope.

[00:35:31] Speaker 02:
What about Datascope, where this court said that it was fine, not an abuse of discretion, for the district court to award prejudgment interest at the T-bill rate compounded annually.

[00:35:44] Speaker 02:
And didn't seem to look at all.

[00:35:46] Speaker 02:
I don't see anything in this decision.

[00:35:48] Speaker 02:
But this court, in that case, looked to the law of the regional circuit to figure out how to award prejudgment interest under 35 USA section 284.

[00:35:57] Speaker 00:
Right.

[00:35:58] Speaker 00:
And it is our position that prejudgment judgment interest is governed by the law of the circuit.

[00:36:06] Speaker 00:
And I cannot point to you today to a specific case that is contrary to the case that you cite.

[00:36:18] Speaker 00:
stating that there is no reason to look at the law of the regional circuit.

[00:36:26] Speaker 00:
But it is Douglass's position that the law of the regional circuit is what should control in pre-judgment, for the pre-judgment interest calculation.

[00:36:38] Speaker 02:
I'd also point out the BioRAD decision.

[00:36:40] Speaker 02:
It's BioRAD v. Nicollet.

[00:36:42] Speaker 02:
That's another case.

[00:36:45] Speaker 02:
were the prejudgment interest.

[00:36:46] Speaker 02:
There's actually a good number of prejudgment.

[00:36:48] Speaker 02:
Mike Lockhart just sent me like 10 cases where the prejudgment interest was compounded.

[00:36:56] Speaker 02:
All the determination of the prejudgment interest and what to compound it at and at what rate was left to the discretion of the district court without looking to the law of the regional circuit.

[00:37:07] Speaker 00:
Right.

[00:37:07] Speaker 00:
And there's also the, granted, Your Honor, there are a lot of cases out there that address

[00:37:15] Speaker 00:
the prejudgment interests and that give the district court deference to look at things that give, and that give the other, that give courts of appeals certain abilities to look at this issue as well.

[00:37:32] Speaker 00:
But I would also refer, your honor, to Transmatic, the gluten industries, 180F3D1343, which is a 1999 fed circuit case, which says that the

[00:37:46] Speaker 00:
It says that the regional circuit law does govern these issues.

[00:37:51] Speaker 00:
And if we look to the Amico-Cadiz case, which is the seminal case in the Seventh Circuit on prejudgment interest, what that case says is that prejudgment interest needs to be awarded at the prime rate or above.

[00:38:07] Speaker 00:
And the reasoning for that is because as a patent owner who's

[00:38:15] Speaker 00:
patents are infringed, Douglas became an involuntary creditor to buyers.

[00:38:21] Speaker 00:
They weren't investing money in buyers.

[00:38:24] Speaker 00:
They had money taken away from them as a result of this infringement.

[00:38:30] Speaker 00:
And because of this involuntary loan to buyers, we shouldn't be looking at something like a T-bill rate, which is an investment type rate.

[00:38:43] Speaker 00:
We should be looking at

[00:38:45] Speaker 00:
the prime rate, which is something that's more akin to a loan.

[00:38:50] Speaker 00:
And this prime rate is what Douglas must pay either explicitly if it borrows money or implicitly if it finances cash out of hand.

[00:39:02] Speaker 00:
And this idea that

[00:39:07] Speaker 00:
Douglas's damages award was somehow an investment in buyers and should only be awarded at a rate that it would have received if it had put all of that money into a T-bill rate seems to be very inconsistent with the Amico-Cadiz case, which certainly states that the prime rate is more accurate in this instance where there is

[00:39:37] Speaker 00:
an unsecured loan to a creditor.

[00:39:41] Speaker 03:
Was there another point you needed on cross appeal?

[00:39:45] Speaker 00:
The other point on cross appeal your honor is that the district court erred in setting post verdict royalties for the 530 and 978 patents.

[00:39:56] Speaker 00:
In that instance there was an ongoing royalty that was ordered in lieu of an injunction for that technology in between the

[00:40:07] Speaker 00:
first trial and the decision on the first appeal, which overturned our request, which instituted our request for an injunction.

[00:40:19] Speaker 00:
So there was this time period where there was a compulsory license for two of the patents that were found to be infringed.

[00:40:26] Speaker 00:
And what happened was the court originally awarded that license rate at 6.2 to 5%.

[00:40:37] Speaker 00:
On post-judgment briefing, we advocated that that rate should be increased to $400 per unit.

[00:40:48] Speaker 03:
You say post-judge, this is after the jury verdict?

[00:40:51] Speaker 00:
Yes, Your Honor, yes.

[00:40:53] Speaker 00:
And what Judge Connolly decided to do was award it at $200, which is about a 7% rate, only slightly above the 6.225 rate.

[00:41:07] Speaker 00:
Our position is that this rate should be substantially higher at the $400 rate because the infringement must, because the ongoing royalty must compensate the patentee for relinquishing its right to exclude.

[00:41:23] Speaker 03:
On these issues when I was leading up to, you're saying that there was not substantial evidence to support the jury verdict?

[00:41:31] Speaker 00:
No, Your Honor.

[00:41:32] Speaker 00:
We're not saying that.

[00:41:35] Speaker 00:
substantial evidence to support the jury verdict.

[00:41:39] Speaker 00:
Then I'm not sure what you're asking us to do?

[00:41:42] Speaker 00:
What we're asking you to do on the ongoing royalty.

[00:41:46] Speaker 00:
So this is an issue that was first decided by this court in the first Douglas appeal, that the ongoing royalty that was awarded to Douglas was insufficient because of the methodology used by the court

[00:42:06] Speaker 00:
involving the 25% rule.

[00:42:08] Speaker 00:
We then went back and re-briefed it to the court, and the court came back with a rate that was substantially similar to the rate that this court rejected.

[00:42:20] Speaker 00:
And what we're asking this court to do is to reconsider the judge's decision to award the post-vertic royalties on the 539

[00:42:34] Speaker 00:
seven, eight patents at a rate that reflects this idea that buyers willfully infringe the patents after the first jury verdict.

[00:42:44] Speaker 03:
OK.

[00:42:45] Speaker 00:
Thank you, Your Honor.

[00:42:46] Speaker 03:
Any questions?

[00:42:47] Speaker 03:
No questions.

[00:42:48] Speaker 03:
OK.

[00:42:49] Speaker 03:
Thank you.

[00:42:50] Speaker 03:
We have some rebuttal time.

[00:42:52] Speaker 04:
May it please the court, Judge Chin, you ask counsel whether it was his view that lift frame and support frame were about the same thing.

[00:43:03] Speaker 04:
Seizing on the apparent answer that that might be a good thing to agree to, he agreed to it.

[00:43:08] Speaker 04:
I would, however, direct the court to the red brief at page 42 where Douglas says very clearly that while the term lift frame connotes a support frame that supports a lift, the term support frame carries no such connotation.

[00:43:27] Speaker 04:
Claim 45 uses the broader term support frame in lieu of the term lift frame.

[00:43:31] Speaker 04:
When construing support frame, the district court specifically referred to language in the summary of invention pertinent to the lift frame.

[00:43:38] Speaker 04:
And he says that during the prosecution of the broadening reissue, prosecution counsel explained that Claim 45 is different from one because it defines a support frame in contrast to a lift frame.

[00:43:51] Speaker 04:
So they made the statement in their brief and throughout the broadening reissue that, in fact, support frame was broader.

[00:43:59] Speaker 04:
than lift frame.

[00:44:00] Speaker 04:
That has always been their position and that's what creates the fundamental problem here.

[00:44:05] Speaker 04:
Addressing very quickly the issues on cross appeal, I wanted to say first of all that there really is no, the Seventh Circuit, even if the Seventh Circuit test applies, the Seventh Circuit doesn't say that there is a per se rule that you must always apply the

[00:44:29] Speaker 04:
the market, I'm sorry, that you must always go to what you could get by, what you would have to pay for a loan for the money, but that the court can enter any number if it does a refined analysis.

[00:44:48] Speaker 04:
We made the argument that the refined analysis that was done by the court was adopting our expert's analysis, and there really is no response to why that isn't a refined analysis.

[00:44:58] Speaker 04:
other than the argument that I heard from counsel that, well, somehow

[00:45:02] Speaker 04:
There's a difference between a loan and an investment, and they should get the benefit of an investment, or the benefit of a loan rather than an investment.

[00:45:13] Speaker 04:
In fact, a loan and an investment are the same thing, right?

[00:45:16] Speaker 04:
That's how savings and loans work.

[00:45:18] Speaker 04:
If I loan you money, you agree to pay additional money back to me, and that's my investment.

[00:45:23] Speaker 04:
I invest the money in you, you give me the amount back.

[00:45:27] Speaker 04:
And the court was basically saying that was the position Douglas was in

[00:45:31] Speaker 04:
at the relevant time period.

[00:45:33] Speaker 04:
It was cash flush.

[00:45:34] Speaker 04:
It was investing money by essentially loaning it to its distributors and otherwise investing it as it might in the money market of the time, because that's what its balance sheet showed.

[00:45:50] Speaker 04:
The court said, it's only fair that that's the best that they get back.

[00:45:54] Speaker 04:
Because that's all they've been hurt.

[00:45:56] Speaker 04:
To put them in the position that they would have been had there been no infringement simply required that they make back on their money the kind of interest that they would have made if they had been able to invest that money in a risk-free investment.

[00:46:11] Speaker 04:
And that is the Treasury bill rate.

[00:46:14] Speaker 04:
That's why the Treasury bill rate was appropriate.

[00:46:17] Speaker 04:
It was appropriate to the specific share of those things.

[00:46:19] Speaker 01:
We should look at them as investing in their competitor rather than giving a loan to their competitor?

[00:46:25] Speaker 04:
In this particular case, yes, that's true, Your Honor.

[00:46:29] Speaker 04:
But the cases, and Judge Stoll was referring to the Federal Circuit cases that adopt the Treasury bill rate, seem to see that kind of analysis as appropriate because of the requirement that this is not a punitive award.

[00:46:46] Speaker 04:
It shouldn't be a punitive award when you're awarding prejudgment interest.

[00:46:49] Speaker 04:
It should simply put you in the position that you would have been had there been no infringement.

[00:46:54] Speaker 04:
And the position they would have been in had there been no infringement is that they would have had some additional cash that they could have put into, for example, money market funds.

[00:47:03] Speaker 04:
That's why it was appropriate for Judge Connolly to adopt the prejudgment rate he did.

[00:47:09] Speaker 04:
Very quickly on the other cross-appeal issue, the fact is that there were no ongoing royalties to be awarded in this case because all of the plows that were

[00:47:23] Speaker 04:
The subject of that award were actually manufactured before the jury verdict, and they were sold before the entry of final judgment in the case.

[00:47:32] Speaker 04:
And so they don't fit into that category of devices that would be made after judgment, and in lieu of an injunction, an ongoing royalty is paid.

[00:47:44] Speaker 04:
These sales were of the same variety as the sales

[00:47:49] Speaker 04:
that the jury awarded an amount for.

[00:47:52] Speaker 04:
And so it's appropriate that, frankly, the jury's $85 amount be applied to those plots.

[00:48:00] Speaker 04:
Now, Judge Connolly found $200.

[00:48:02] Speaker 04:
We didn't appeal and argue that it should have been only $85, frankly, merely as an economic matter.

[00:48:09] Speaker 04:
But to award a $400 rate instead of the $200 rate just has no basis.

[00:48:15] Speaker 04:
You can't even justify it.

[00:48:17] Speaker 04:
by saying that, well, since it was post verdict, there should be an enhancement of damages because it would be more than the three times enhancement that the enhancement statute would have permitted.

[00:48:32] Speaker 04:
So Judge Connolly was correct, and he shouldn't be disturbed in his ongoing royalty analysis that was really just an award

[00:48:41] Speaker 04:
of money for plows that had been manufactured before the jury verdict came out.

[00:48:48] Speaker 03:
Any more questions?

[00:48:50] Speaker 03:
Any more questions?

[00:48:51] Speaker 03:
OK.

[00:48:52] Speaker 03:
Thank you.

[00:48:53] Speaker 03:
Thank you both.

[00:48:54] Speaker 03:
The case is taken under submission.

[00:48:56] Speaker 03:
That concludes this morning's argued cases.

[00:49:00] Speaker 00:
All rise.

[00:49:05] Speaker 00:
The honorable court is adjourned until tomorrow morning at 10 o'clock AM.