Earlier this month, the Federal Circuit heard oral argument in Arendi S.A.R.L. v. Oath Holdings Inc., a patent case we have been following because it attracted an amicus brief. In it, Arendi appeals a judgment of a district court, raising questions concerning patent eligibility, claim construction, indefiniteness, and infringement. Judges Dyk, Linn, and Hughes heard the oral argument. This is our argument recap.
John Pierre Lahad argued for Arendi. He opened by addressing Google’s waiver-of-reviewability argument regarding invalidity. Lahad said “the district court denied [a post-trial motion] as moot.” A judge interrupted to correct him, saying “there was an order that denied the motion” and that “it did not say it was moot.” Lahad acknowledged he might be mistaken on the mootness point, but insisted the key issue was that “the district court didn’t reach the merits of that post-trial motion because there was no counterclaim [of invalidity] filed.” A judge again pushed back, noting “the jury found two independent bases to find against [Arendi’s] claim of infringement,” and one was invalidity. The judge asked “how the district court judge can elect to ignore part of the jury verdict.” The judge said the district judge “either had to rule on [Arendi’s] Rule 50 motion and grant or deny it, and it sounds like she denied it, which means the jury’s verdict on infringement is still out there.” He added, “Or alternatively, if she didn’t rule on it and held it in abeyance somehow, then this isn’t even a final judgment.”
The judge suggested that Arendi should present “authority that says the district court, after a jury verdict, can enter judgment only on one of those grounds, absent expressly ruling on some kind of post-trial motion.” Lahad later argued it was clear that “the district court did not consider or implicate invalidity in the final judgment.” A judge challenged that position, noting that the judgment simply states Arendi’s “claims of infringement fail, but that doesn’t mean that it failed on non-infringement grounds.”
A judge later asked whether Arendi’s position meant that, “when the parties agree to submit two questions to the jury not in the alternative” and “the jury finds . . . non-infringement, then the invalidity portion is just advisory or not effective somehow.” Lahad said yes, because without a counterclaim of invalidity there was only one claim in the case.
As the exchange continued, a judge suggested “the problem is that what the district court did here is very unclear” and blamed Arendi for “confus[ing] the district court by asking her not to rule on something that was part of the jury’s verdict.”
After Lahad turned to the merits, he argued that the Federal Circuit had previously held that a patent in suit “provides a beneficial coordination between a first computer program displaying a document and a second computer program for searching an external information source.” He said, therefore, the patent is “an improvement in the computer’s ability” and therefore eligible for patenting. A judge suggested addressing eligibility for the other asserted patents first, and then tackling whether the particular patent is the same or different. Lahad responded by arguing “this improvement in the computer as a tool is reflected in those other claims from the other patents as well.” He argued that the district court’s distinction between the patents was not grounded in the claim language. During this portion of the argument a judge noted “they are all directed to the idea of . . . fetching data from a different program while you’re operating in a simple program,” without detailing “the functionality of how that is done.”
Lahad later addressed claim construction, arguing that the term “document” does not require editability but has only two limitations—to be electronic and to contain text. In response, a judge observed that, “if we agree with you on this ‘document’ claim construction, then the case goes back to the district court, and [the case] is back to the validity . . . verdict.”
Ginger Anders argued for Google. Before Anders began, a judge suggested Google also has a jurisdictional problem “because [it] didn’t file a cross-appeal on the . . . ineligibility” of one patent. According to the judge, this “has nothing to do with whether there’s a counterclaim . . . because the unpatentability finding would expand the judgment.” Anders disagreed, explaining that “the judgment rests on invalidity as well as on noninfringement” and, therefore, “there would be no expansion of the judgement if the [relevant patent] is ruled ineligible.” This, she noted, brings the court back to the invalidity issue.
Anders later argued “the court should not reach any of the” issues related to one patent “because the district court judgment does rest on invalidity.” She asserted that, once the jury found both invalidity and non-infringement, the Seventh Amendment prohibited disturbing that verdict absent traditional common-law grounds. She explained that, although Arendi initially filed a Rule 59 motion, it later withdrew it and asked the court not to rule on it. The district court denied judgment as a matter of law, she explained, leaving the jury verdict intact. Anders also said that the district court also denied Arendi’s request to narrow the judgment, and argued it is clear that the judgment also rested on invalidity.
A judge pushed back, pointing to parts of the record suggesting the district court was “not entering judgement on invalidity.” Anders responded that, when read as a whole, “it is very clear that [the district court judge] thought she was entering a judgment that was supported by two independent grounds.” If the panel finds it unclear, she argued, the Seventh Amendment bars disregarding the jury’s invalidity verdict absent a granted Rule 59 motion.
A judge suggested an alternative of giving “leave to the parties to go back to the district court and clarify what the judgment is.” Anders opposed that approach based on the two reasons she already gave. The judge, however, noted that the record reasonably support Arendi’s reading as well.
The discussion later turned to one of the patents and whether the district court had correctly construed “document.” According to Anders, “with respect to editability . . . the primary point there is that all of the claims of the . . . patent require the document to be editable because they all contain a limitation that says the users enters textual information into a document.” When a judge noted that some claims lack that language, Anders responded by arguing that, because all claims in one patent and some in another patent require editability, the term “document” must carry that same meaning across all related patents in the family. She invoked the presumption that the same term used in related patents has a consistent meaning.
With respect to eligibility, Anders argued the claims are directed to an abstract idea of “beneficial coordination.” She suggested the claims never explain how to achieve that beneficial coordination.
Jeffri A. Kaminski argued for Oath and Oath Holdings. He addressed the grant of summary judgment of no direct infringement by Oath. Kaminski explained that, although Arendi “asserts that Oath makes the computer-readable medium encoded with instructions when Oath downloads its code onto the user device,” it is in fact the users who download it onto their own device. “Neither Oath nor anybody acting on Oath’s behalf does the installation or the downloading,” he argued.
Kaminski further noted that Arendi’s alternative theory that “Oath offers to sell the claimed computer readable medium” fails for the same reasons. He added that “there’s no genuine dispute that the Oath code [and] Oath app that is available for download does not include all the required elements.” Therefore, he concluded, the district court’s summary judgment of no direct infringement by Oath should be upheld.
We will continue monitoring this case and report on developments.