Argument Preview

Only one case being argued next week at the Federal Circuit attracted any amicus briefs, Conversant Wireless Licensing v. Apple Inc. This case previously came to the Federal Circuit in 2018 when the court determined that Apple infringed a patent asserted by Conversant. The court, however, remanded the case to the district court to determine whether the patent was unenforceable. On remand, the district court found that the patent was unenforceable, and Conversant now appeals that judgment. This is our argument preview.

Conversant explains in its opening brief “that Nokia, the original patentee of the ’151 Patent, made an untimely disclosure of a related patent application to the ETSI standards setting body.” The district court, as a result, “grant[ed] Apple’s motion for unenforceability” in this circumstance, concluding “that Conversant has implicitly waived its rights to enforce the ’151 patent . . . against products practicing the GPRS standard, including the accused Apple products.”

Conversant argues that the district court committed three errors.

First, Conversant claims that “a finding of implied waiver requires proof of ‘but for’ causation.” According to Conversant, the district court, however, “incorrectly held that ‘such but-for proof . . . is not required.’”

Second, Conversant contends that the district court failed to apply the correct clear and convincing standard of proof on the issue of materiality and causation. Instead, says Conversant, the court accepted evidence that, by its own admission, no more than “suggests” a “reasonable possibility that the ‘151 patent would not have been incorporated into the GPRS standard.”

Third, Conversant submits that the district court made a factual error in holding that the ’151 patent is essential, or “all but” essential, to the GPRS standard, when the patent was “at most an option within the GPRS standard.”

In its response brief, Apple points out that the Federal Circuit “already determined that Nokia (1) had a duty to disclose the existence of the ’151 patent family when it first proposed Mr. Oksala’s idea for inclusion in the GPRS standard, and (2) breached that duty by waiting more than four years after the deadline to do so.” It claims the district court correctly found an implied waiver as a result of Nokia and Conversant’s unjust benefits from the untimely disclosure. Further, it directly opposes Conversant’s argument that but-for causation must be proven, claiming that “nothing in the Court’s two implied waiver decisions in this case, or in Therasense, or in any other decision from this Court grafts a ‘but-for’ materiality requirement from inequitable conduct doctrine into implied waiver.”

In its reply, Conversant asserts that “Apple again argues for a far lower evidentiary threshold than existing law allows,” and that Apple’s “response confirms that the district court’s ‘unjust benefits’ ruling rests on reversible errors.” Conversant notes that Apple did not address Conversant’s argument concerning the correct standard of proof. Further, Conversant reiterates its argument that Apple is required to show that the untimely disclosure in fact “resulted in the ultimate alleged ‘unfair benefits,’” for which, it contends, there is no evidence in the record.  

Nokia filed an amicus brief in support of Conversant. In it, Nokia reiterates that it “did not gain any extra benefit during the standards-setting process.” It points out that “the district court found . . . ‘Nokia’s misconduct was not egregious or extraordinary’” and asserts that “a case like this does not come close to meeting the high threshold for unenforceability.” Further, it argues from a policy standpoint that “imposing the severe remedy of unenforceability in these circumstances could potentially have far-reaching and unintended consequences in the industry.”

Ericsson, Panasonic, Blackberry and Koninklijke Philips filed a second amicus brief in support of Conversant. In it, they argue that the case was “remanded for the district court to address remedy under Therasense Inc. v. Becton, Dickinson and Co.,” but the district court “departed from Theransense’s central teaching as well as general equitable principles.” They assert there was no actual unfair benefit that resulted from the failure to disclose. Further, “[a] rule that finds patents unenforceable for failure to disclose immaterial information invites the evils—wasteful over-disclosure and litigation gamesmanship—that Therasense sought to banish.”

Oral arguments will be heard on Tuesday, August 4. We will keep track of this case and report on any developments.