n he supreme court of the united states - scotusblog€¦ · harry j. roper aaron a. barlow paul d....

No. 15-___

WILSON-EPES PRINTING CO., INC. – (202) 789-0096 – WASHINGTON, D. C. 20002

IN THE

Supreme Court of the United States ————

THE DOW CHEMICAL COMPANY,

Petitioner,

v.

NOVA CHEMICALS CORPORATION (CANADA) and NOVA CHEMICALS INC. (DELAWARE),

Respondents.

————

On Petition for a Writ of Certiorari to the United States Court Of Appeals

for the Federal Circuit

————

PETITION FOR A WRIT OF CERTIORARI

————

HARRY J. ROPER AARON A. BARLOW PAUL D. MARGOLIS JENNER & BLOCK LLP 353 North Clark Street Chicago, IL 60654 (312) 222-9350

KATHLEEN M. SULLIVAN Counsel of Record

RAYMOND N. NIMROD WILLIAM B. ADAMS CLELAND B. WELTON II QUINN EMANUEL URQUHART

& SULLIVAN, LLP 51 Madison Avenue 22nd Floor New York, NY 10010 (212) 849-7000 kathleensullivan@ quinnemanuel.com

Counsel for Petitioner March 16, 2016

(i)

QUESTION PRESENTED

Whether factual findings underlying a district court’s determination on the definiteness of a patent claim under the Patent Act, 35 U.S.C. 112, like a district court’s factual findings underlying construc-tion of a patent claim, are subject to appellate review only for clear error or substantial evidence rather than de novo review.

ii

RULE 29.6 STATEMENT

The Dow Chemical Company is a publicly traded company. It has no parent corporation, and no publicly held company owns 10 percent or more of its stock.

(iii)

TABLE OF CONTENTS

Page

QUESTION PRESENTED .................................. i

RULE 29.6 STATEMENT ................................... ii

TABLE OF AUTHORITIES ................................ v

INTRODUCTION ................................................ 1

OPINIONS BELOW ............................................ 3

JURISDICTION .................................................. 3

CONSTITUTIONAL AND STATUTORY PROVISIONS INVOLVED .............................. 4

STATEMENT ...................................................... 4

A. Statutory Background ................................ 4

B. Dow’s Patent Claims .................................. 5

C. The Proceedings Below ............................... 9

REASONS FOR GRANTING THE WRIT .......... 15

I. THE FEDERAL CIRCUIT’S DE NOVO REVIEW OF FACTUAL FINDINGS UNDERLYING A PATENT DEFINITE-NESS DETERMINATION WARRANTS CERTIORARI ............................................ 16

A. The Judgment Below Conflicts With Teva And Rule 50(a) ............................ 17

B. This Case Presents An Excellent Vehicle For Certiorari ......................... 21

II. REVIEW OF PATENT DEFINITENESS FINDINGS IS AN IMPORTANT AND RECURRING ISSUE ON WHICH THE FEDERAL CIRCUIT IS DEEPLY FRACTURED ............................................ 25

CONCLUSION .................................................... 29

iv

TABLE OF CONTENTS—Continued

APPENDIX Page

APPENDIX A – Federal Circuit Opinion Regarding Supplemental-Damages Judg-ment (August 28, 2015) .................................. 1a

APPENDIX B – District Court Opinion and Order Regarding Supplemental Damages (March 28, 2014) ............................................ 26a

APPENDIX C – Federal Circuit Opinion Regarding Merits Judgment (January 24, 2012) ............................................................... 54a

APPENDIX D – District Court Opinion And Order Regarding Rule 50 And Rule 59 Motions (July 30, 2010) .................................. 106a

APPENDIX E – District Court Opinion Regarding Summary Judgment Motions (July 30, 2010) ................................................ 119a

APPENDIX F – District Court Opinion Regarding Claim Construction (June 25, 2009) ............................................................... 125a

APPENDIX G – Federal Circuit Order Denying Rehearing And Accompanying Opinions (December 17, 2015) ....................... 164a

APPENDIX H – Relevant Statutory Provi-sions And Rules .............................................. 186a

APPENDIX I – Excerpts Of Transcript Of District Court Proceedings (May 28, 2010; June 4, 2010; June 7, 2010; June 10, 2010; June 14, 2010) ................................................ 193a

APPENDIX J – District Court Verdict Form (June 15, 2010) ............................................... 249a

v

TABLE OF AUTHORITIES

CASES Page(s)

Abbvie Inc. v. Mathilda & Terence Kennedy Institute of Rheumatology Trust, 764 F.3d 1366 (Fed. Cir. 2014) ................. 28

Acosta v. City & Cty. of San Francisco, 83 F.3d 1143 (9th Cir. 1996) ..................... 21

Akzo Nobel Coatings, Inc. v. Dow Chem. Co., 811 F.3d 1334 (Fed. Cir. 2016) ................. 27

Amgen Inc. v. Harris, 136 S. Ct. 758 (2016) ................................. 24

Anderson v. Bessemer City, 470 U.S. 564 (1985) ................................... 17

Biosig Instruments, Inc. v. Nautilus, Inc., 783 F.3d 1374 (Fed. Cir. 2015) ................. 28

BJ Servs. Co. v. Halliburton Energy Servs., Inc., 338 F.3d 1368 (Fed. Cir. 2003) ................. 5

Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141 (1989) ................................... 28

CardSoft, LLC v. VeriFone, Inc., 807 F.3d 1346 (Fed. Cir. 2015) ................. 26

CardSoft v. Verifone, Inc., 769 F.3d 1114 (Fed. Cir. 2014) ................. 26

Circuit Check Inc. v. QXQ Inc., 795 F.3d 1331 (Fed. Cir. 2015) ................. 21

vi

TABLE OF AUTHORITIES—Continued

Page(s)

CSX Transp., Inc. v. Hensley, 556 U.S. 838 (2009) ................................... 24

Dennison Mfg. Co. v. Panduit Corp., 475 U.S. 809 (1986) ................................... 18, 24

eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006) ................................... 17

Eidos Display, LLC v. AU Optronics Corp., 779 F.3d 1360 (Fed. Cir. 2015) ................. 26

Enzo Biochem Inc. v. Applera Corp., 780 F.3d 1149 (Fed. Cir. 2015) ................. 26

EON Corp. IP Holdings LLC v. AT&T Mobility LLC, 785 F.3d 616 (Fed. Cir. 2015) ................... 27-28

Ethicon Endo-Surgery, Inc. v. Covidien, Inc., 796 F.3d 1312 (Fed. Cir. 2015) ................. 27

Galloway v. United States, 319 U.S. 372 (1943) ................................... 19, 29

Graham v. John Deere Co. of Kansas City, 383 U.S. 1 (1966) ....................................... 21

Great Northern Ry. Co. v. Merchants’ Elevator Co., 259 U.S. 285 (1922) ................................... 17-18

Harries v. Air King Prods. Co., 183 F.2d 158 (2d Cir. 1950) ...................... 21-22

vii


Page(s)

Kroshnyi v. U.S. Pack Courier Servs., Inc., 771 F.3d 93 (2d Cir. 2014) ........................ 21

KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398 (2007) ................................... 21

Markman v. Westview Instruments, Inc., 517 U.S. 370 (1996) ................................... 17

Microsoft Corp. v. i4i Ltd. P’ship, 131 S. Ct. 2238 (2011) ........................... 4, 19, 22

Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120 (2014) ................................... 1, 4, 12, 15, 16, 18, 20, 24

Nova Chems. Corp. (Canada) v. Dow Chem. Co., 607 F. App’x 993 (Fed. Cir. 2015) ............. 11

Nova Chems. Corp. (Canada) v. Dow Chem. Co., 2015 WL 5766257 (D. Del. Sept. 30, 2015) ............................. 12

Power Integrations, Inc. v. Fairchild Semiconductor Int’l, Inc., 711 F.3d 1348 (Fed. Cir. 2013) ................. 28

Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133 (2000) ................................... 5, 19

Sanofi-Aventis Deutschland GmbH v. Glenmark Pharm. Inc., USA, 748 F.3d 1354 (Fed. Cir. 2014) ................. 21

viii


Page(s)

Starceski v. Westinghouse Electric Corp., 54 F.3d 1089 (3d Cir. 1995) ...................... 21

Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831 (2015) ..... 1, 3, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29

Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc., 789 F.3d 1335 (Fed. Cir. 2015) ................. 20, 27

STATUTES AND RULES

35 U.S.C. 112 .............................................. i, 1, 4

35 U.S.C. 282 .......................................... 4, 19, 22

28 U.S.C. 1254(1) .......................................... 3

FED. R. CIV. P. 50 ........ 2, 4, 5, 14, 15, 16, 17, 19, 20, 22, 23, 24, 29

FED. R. CIV. P. 52 .......................................... 19, 28

FED. R. CIV. P. 52 advisory committee’s note (1985) ................................................. 17

FED. R. CIV. P. 60(d) ..................................... 11

LEGISLATIVE MATERIAL

H.R. Rep. No. 97-312 .................................... 28

OTHER AUTHORITIES

Dennis Crouch, Giving Deference to the Supreme Court in Teva v. Sandoz, PATENTLY-O (Jan. 21, 2015) ..................... 25

ix


Page(s)

Jason Rantanen, Teva, Nautilus, and Change Without Change, 18 STAN. TECH. L. REV. 430 (2015) ........... 26

Jonas Anderson & Peter S. Menell, Restoring the Fact/Law Distinction in Patent Claim Construction, 109 NW. U.L. REV. ONLINE 187 (2015) ..... 18

Reexamination Certificate 6,111,023 C1 (U.S.P.T.O. July 14, 2014) ........................ 11

Reexamination Certificate 5,847,053 C1 (U.S.P.T.O. Aug. 18, 2014) ....................... 11

Stacey Cohen & William Casey, 1 Year Later, Teva Providing Less Certainty Than Expected, LAW360 (Jan. 19, 2016) .. 25

STEPHEN M. SHAPIRO ET AL., SUPREME COURT PRACTICE (10th ed. 2013) .............. 24

INTRODUCTION

In Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120 (2014), this Court addressed the standard for patent claim definiteness under 35 U.S.C. 112, but expressly left open the question “whether factual findings subsidiary to the ultimate issue of definite-ness trigger” deferential review on appeal. Id. at 2130 n.10. In Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831 (2015), this Court answered the very same question in the context of patent claim construction, holding that factual findings subsidiary to claim construction must be reviewed deferentially on appeal. Id. at 837-38, 841.

This case presents the perfect vehicle to answer the question left open in Nautilus and to consider whether Teva’s deference requirement extends from factual findings underlying claim construction to factual findings “subsidiary to the ultimate issue of definiteness.” In an appeal from a patent-infringe-ment judgment after jury trial where the jury expressly rejected an indefiniteness defense, the Federal Circuit at first affirmed, upholding the finding that the patent claims at issue here were definite under pre-Nautilus case law. But in a later (post-Nautilus) appeal from a $28 million supplemental-damages judgment in the same case, the Federal Circuit held the same patent claims indefinite.

The Federal Circuit’s about-face on definiteness turned solely on its de novo review of a factual issue dependent on extrinsic evidence: namely, whether a person of ordinary skill in the art would know how to make a measurement related to a claim term. The jury implicitly found that a skilled artisan would have such knowledge, but the Federal Circuit declined to consider or give any deference to that finding in

2 holding the claims indefinite. Had the Federal Circuit applied the normal deference required by Rule 50(a), there is no doubt it would have had to affirm, for the record amply supported the jury’s finding: Patents are presumed valid under the Patent Act, uncontested expert testimony showed that a person of ordinary skill in the art would understand the measurement required by the claims, and no evidence (much less clear and convincing evidence) overcame that showing. See FED. R. CIV. P. 50(a)(1) (providing for judgment as a matter of law (“JMOL”) only if “a reasonable jury would not have a legally sufficient evidentiary basis” for its factual findings).

The need for this Court’s review is underscored by the extraordinary fracture this case caused among the judges of the Federal Circuit. The court denied a petition for rehearing en banc. App. 165a-166a. Five members of the court concurred in the denial of rehearing but criticized the panel’s decision in pointed terms. App. 168a-175a. Four of those judges noted that the panel had failed to give “deference to the jury’s underlying fact findings” subsidiary to its definiteness finding. App. 175a. The concurrence recognized that such deference was required, but nonetheless declined to support en banc review. The three judges on the panel also concurred in the denial, asserting that their decision adhered to existing precedent. App. 167a. The panel judges did not explain how precedent justified their de novo review of the jury’s definiteness findings. Two judges dissented on jurisdictional grounds. App. 177a-187a.

Because the Federal Circuit has declined to resolve this important issue despite five judges’ acknowledge-ment that the panel decision applied the wrong standard of review, this Court should grant review

3 to provide much-needed clarity on the standard of review for subsidiary factual findings on patent definiteness. And, in light of Teva, the decision below presents the rare case in which summary reversal would be appropriate.

OPINIONS BELOW

The opinion of the U.S. Court of Appeals for the Federal Circuit is reported at 803 F.3d 620, and reproduced at App. 1a-25a. The order of the court of appeals denying rehearing and the accompanying opinions are reported at 809 F.3d 1223, and reproduced at App. 164a-185a.

A prior opinion of the Federal Circuit in this case is reported at 458 F. App’x 910, and reproduced at App. 54a-105a.

Relevant opinions and orders of the U.S. District Court for the District of Delaware are reported or available, respectively, at 629 F. Supp. 2d 397; 2010 WL 3070189; 2010 WL 3056617; and 2014 WL 1285508. They are reproduced at App. 26a-53a; 106a-118a; 119a-124a; and 125a-163a.

JURISDICTION

The court of appeals issued its decision on August 28, 2015 (App. 1a-25a), and denied Dow’s timely petition for rehearing on December 17, 2015 (App. 164a-166a). This Court has jurisdiction under 28 U.S.C. 1254(1).

4 CONSTITUTIONAL AND STATUTORY

PROVISIONS INVOLVED

The Seventh Amendment to the Constitution provides:

In suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise reexamined in any court of the United States, than according to the rules of the common law.

Relevant provisions of the Patent Act, 35 U.S.C. 1 et seq., and Rule 50 of the Federal Rules of Civil Procedure, are reproduced at App. 186a-192a.

STATEMENT

A. Statutory Background

The Patent Act provides that a patent “specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter” of the invention. 35 U.S.C. 112; App. 186a-187a. This Court has interpreted that statutory lan-guage to mean that a patent is invalid as indefinite “if its claims, read in light of the specification delineating the patent, and the prosecution history, fail to inform, with reasonable certainty, those skilled in the art about the scope of the invention.” Nautilus, 134 S. Ct. at 2124.

Patents are “presumed valid,” 35 U.S.C. 282; App. 188a-189a, and a lack of definiteness, like any “invalidity defense, [must] be proved by clear and convincing evidence,” Microsoft Corp. v. i4i Ltd. P’ship, 131 S. Ct. 2238, 2242 (2011). Definiteness is an issue

5 of law but may involve subsidiary factual disputes that are properly resolved by a jury. See, e.g., BJ Servs. Co. v. Halliburton Energy Servs., Inc., 338 F.3d 1368, 1372 (Fed. Cir. 2003).

Rule 50 of the Federal Rules of Civil Procedure provides in relevant part that a court may “grant a motion for judgment as a matter of law” contrary to a jury verdict only if “a reasonable jury would not have a legally sufficient evidentiary basis to find for the [prevailing] party on that issue.” FED. R. CIV. P. 50(a)(1); App. 190a-192a. Such a motion requires a court, upon review of “all of the evidence in the record,” to “draw all reasonable inferences in favor of the nonmoving party” and to “disregard all evidence favorable to the moving party that the jury is not required to believe.” Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150-51 (2000).

B. Dow’s Patent Claims

The patents at issue, U.S. Patent Nos. 5,847,053 and 6,111,023, both now expired, were held by The Dow Chemical Company (“Dow”). In relevant part, they claimed new and useful kinds of plastic film, made by blending two polymer compounds with specified properties. See App. 126a. Dow commercialized its inventions through its “ELITE” plastic film, which is used in products including food packaging and heavy-duty shipping sacks. See App. 32a.

1. The dispute below relates to a particular property (called “strain hardening”) of one of the polymers (referred to as “Component A”) that is used to make the plastic film to which the patents are directed. “Strain hardening” describes the property whereby a substance becomes stronger (i.e., more

6 resistant to stretching) as it is stretched. See, e.g., App. 201a-204a.

The patents teach that strain hardening should be measured by running a sample of Component A through a device called an “Instron Tensile Tester,” which stretches the sample until it breaks, generating data that is then depicted on a graph called a “stress/strain curve.” App. 18a-19a. The stress/strain curve plots load (the force applied to the sample, measured in pounds) against displacement (how far the sample is stretched, measured in inches). A typical stress/strain curve, with displacement on the x-axis and load on the y-axis, looks like this:

App. 19a. The strain-hardening effect is seen in region “IV” of the graph, which shows a sample becoming increasingly difficult to stretch (requiring a greater load) even as it is stretched further. See App. 20a.

7 The relevant patent claims instruct that, from the

testing data, the reader should determine the stress/strain curve’s “slope of strain hardening”—i.e., the slope (calculated in pounds per inch) of the curve in its strain-hardening region. See App. 21a. This slope number is then used to determine a second parameter called the “slope of strain hardening coefficient” (“SHC”). See App. 3a-5a nn.2-3.1 A sample meets the relevant claim limitations if it has a SHC greater than or equal to 1.3. Id.

2. In the courts below, defendants Nova Chemicals Corporation (Canada) and Nova Chemicals Inc. (Delaware) (collectively, “Nova”) asserted that Dow’s patent claims were indefinite because the claims fail to specify where the “slope of strain hardening” should be measured on the stress/strain curve. The typical curve, as shown above, has more than one slope, and the patent claims do not explicitly identify the location for measuring the slope. Resolution of the indefiniteness defense therefore turned on the factual question whether a person of ordinary skill in the art would know where to measure the slope of strain hardening on the stress/strain curve.

The trial evidence amply supported the conclusion that a skilled artisan would know to measure the slope at its maximum value. Specifically, Dow’s expert Dr. Benjamin Hsiao, a chemistry professor and material science expert (see App. 198a-201a), testified that, for many applications, it is valuable if a material “can be [strain] hardened in a very short period of time”—reflected in a large slope number—because such a

1 Specifically, SHC=(slope of strain hardening)*(I2)0.25. App.

18a. “I2” is the sample’s “melt index” (App. 3a-5a nn.2-3), a property well known in the prior art.

8 material “immediately become[s] very strong” when force is suddenly applied to it. App. 201a-202a. For example, parachutes, seatbelts and plastic garbage bags all would hold more weight with less distortion if made with a material having a large slope of strain hardening. See App. 201a-205a. Dr. Hsiao thus testified that a skilled artisan “will always try to draw the line [for measuring slope of strain hardening] at [the] maximum slope region because that’s the best performance of this material.” App. 205a (emphasis added).2 Further, the record shows that a person of ordinary skill in the art would agree with the common-sense mathematical propositions that “maximum means maximum” and that “[t]here’s only one maxi-mum” slope of strain hardening for a particular curve. App. 209a. Even Nova’s expert witness agreed that any given curve has “only one true maximum slope.” App. 245a.

To the extent there was any dispute at trial regarding the separate question of how a person of ordinary skill in the art would determine the maximum slope, there was ample evidence that such a person would know how to do so. The evidence showed that the most basic method is to identify visually the location on the graph at which the slope is steepest (i.e., has its highest value), and then to

2 He continued: “[O]nly at the maximum slope [will] most all the [polymer] chains … be hardened” (App. 206a), meaning that only at that point “will [you] have a true, complete strain hardening effect” (App. 225a; see App. 207a). And because the point of the test is to identify polymers that have a high slope of strain hardening (permitting a SHC greater than 1.3), “the person of ordinary skill would draw the line [and measure] at the maximum slope.” App. 207a; see App. 208a (a person of ordinary skill “will try to determine the slope of strain hardening at a maximum slope of the tensile curve”).

9 calculate the slope at that location using a pencil and a ruler. See App. 212a-213a, 233a-234a. There was also evidence of alternative methods for calculating or approximating maximum slope (see, e.g., App. 21a-22a, 216a-217a, 230a, 231a-232a, 239a-240a), and Dr. Hsiao explained that he developed an additional method to aid in his analysis (see App. 212a-216a). As Dr. Hsiao testified, a skilled artisan would know to visually inspect the curve in order to choose the method that would result in the correct measurement (see, e.g., App. 214a, 224a, 228a, 230a, 237a), and would further know to disregard methods that produced obviously incorrect results.3 And Nova’s own expert agreed that “persons in the art know how to determine maximum slopes.” App. 244a.

C. The Proceedings Below

1. In 2002, Nova introduced a product (“SURPASS”) that it billed as a substitute or “drop-in” for Dow’s ELITE film. See App. 28a, 33a-34a; C.A.J.A. A10755; A10786; A10788. SURPASS quickly gained market share, becoming the primary competitor to Dow’s ELITE film. See App. 28a, 33-34a, 43a-44a.

Dow filed this patent-infringement suit in the Dis-trict Court for the District of Delaware in 2005. See App. 3a. In pre-trial proceedings, the district court

3 For instance, the “final slope” technique involves determining

the curve’s last slope before the sample snaps. See App. 22a. In most cases the result is the maximum slope, but in some experimental conditions, sample slippage causes the curve to slope downward just before breaking, yielding a negative “final slope.” See App. 217a-219a; App. 194a-196a. A skilled artisan would know not to use the “final slope” method in that circumstance, because a negative slope cannot be the maximum slope. See App. 216a-222a; App. 194a-196a.

10 construed the patent claims (see App. 125a-163a), and ruled that Nova could present to the jury its affirmative defense that the claims were indefinite (App. 143a).

At the conclusion of a 12-day jury trial at which definiteness was specifically contested, the district court instructed that definiteness “is determined from the point of view of the hypothetical person of ordinary skill in the art,” that “[a] patent does not need to expressly recite all the information necessary to determine whether an accused product meets a claim,” and that a claim is definite if omitted information “would have been understood by a person of ordinary skill in the art reading the patent at the time the patent was filed.” App. 247a. The jury was also instructed that Nova “has the burden of proving the claim of indefinite[ness] by clear and convincing evidence.” Id.

The jury found that Nova had infringed Dow’s patents and that Nova had failed to prove the relevant claims indefinite. App. 249a-250a. While the verdict form did not propound particularized interrogatories (see id.), the jury’s finding that the claims were not indefinite necessarily entailed implied findings of subsidiary fact based on the evidence at trial—namely, that a person of ordinary skill in the art would know where and how to measure the “slope of strain hardening.” The jury awarded $61.77 million in damages, covering the period up to December 31, 2009 (the last date for which sales data were available). App. 28a, 251a.

The district court denied Nova’s post-trial JMOL motion, ruling that Dr. Hsiao’s testimony provided “more than ample evidentiary support for the jury’s verdict” of no indefiniteness. App. 112a. The court

11 entered judgment for Dow, but reserved decision on Dow’s request for supplemental damages to account for infringement occurring after December 31, 2009. See App. 2a.

2. Nova appealed, and the Federal Circuit affirmed. App. 54a-105a (“Dow I ”). Rejecting Nova’s argument that the claims were invalid as indefinite, the court held that the record established that “one of ordinary skill in the art would … be able to determine the slope of the strain hardening for the SHC coefficient” (App. 70a); that “one of ordinary skill in the art would know at which particular part along the curve the slope of the stress/strain curve should be measured” (id.); and that “one of ordinary skill in the art would know that the maximum slope of the stress/strain curve was the appropriate value for calculating the SHC coefficient” (App. 72a). The court thus held that, “because one of skill in the art would understand the bounds of the claims, the district court correctly rejected Nova’s indefiniteness challenge.” App. 74a.

This Court denied Nova’s petition for a writ of certiorari. 133 S. Ct. 544 (2012).4

4 Nova made further unsuccessful attempts to escape infringement liability. It first filed ex parte requests for reexamination of Dow’s patents, but the Patent and Trademark Office upheld Dow’s claims. See Reexamination Certificate 6,111,023 C1 (U.S.P.T.O. July 14, 2014); Reexamination Certificate 5,847,053 C1 (U.S.P.T.O. Aug. 18, 2014).

Nova then filed an extraordinary “independent action” seeking relief from the judgment under Fed. R. Civ. P. 60(d), baselessly accusing Dow and its attorneys of procuring the Dow I judgment through fraud and fraud on the court. The district court dismissed Nova’s action from the bench in July 2014, and the Federal Circuit summarily affirmed. Nova Chems. Corp. (Canada) v. Dow Chem. Co., 607 F. App’x 993 (Fed. Cir. 2015). The district

12 3. The district court later held a bench trial to

determine the amount of supplemental damages owed to Dow, and awarded Dow some $28 million for the period from January 1, 2010 through the patents’ expiration in October 2011. See App. 26a-53a. Nova did not raise the issue of definiteness at any point during the pendency of the supplemental-damages proceedings in the district court.

a. Nova appealed the supplemental-damages judgment, arguing (inter alia) that Dow’s patents were indefinite based on this Court’s intervening decision in Nautilus because the claims did not specify with reasonable certainty where on the stress/strain curve to measure the slope of strain hardening. Nova C.A. Br. 46-48. Nova did not argue that the claims were indefinite for failing to specify how to measure the maximum slope of the curve. To the contrary, Nova conceded that “one skilled in the art could physically locate and calculate the ‘maximum slope’ on a stress/strain curve if the artisan knew that such a ‘maximum slope’ approach was called for by the patents-in-suit.” Nova C.A. Reply Br. 13-14; see Nova C.A. Br. 49 (similar).

This time, the Federal Circuit reversed, holding Dow’s patent claims indefinite under Nautilus. App. 1a-25a (“Dow II ”). Citing this Court’s decision in Teva only in passing (App. 24a n.9), the Federal Circuit expressly applied de novo review (App. 7a), and accorded no deference to the implicit factual findings

court viewed Nova’s conduct as so exceptional that it awarded Dow nearly $2.5 million in attorneys’ fees and expenses under 35 U.S.C. 285. See Nova Chems. Corp. (Canada) v. Dow Chem. Co., 2015 WL 5766257, *6 (D. Del. Sept. 30, 2015), appeals pending, Nos. 16-1576, -1680 (Fed. Cir.).

13 necessarily made by the jury in rejecting the indefiniteness defense.

The Federal Circuit assumed arguendo that a per-son of ordinary skill in the art would know where to measure the “slope of strain hardening”—namely, “that the maximum slope should be measured.” App. 21a. But the court nevertheless held sua sponte that the patent claims were indefinite for failure to specify how to measure the maximum slope of a stress/strain curve. The court reasoned that there are “multiple methods” for measuring maximum slope “leading to different results without guidance in the patent or the prosecution history as to which method should be used.” App. 23a. The court identified no record evidence (nor was there any) showing that a person of ordinary skill in the art would not know how to measure the maximum slope of a stress/strain curve.

b. Dow petitioned for panel rehearing or rehearing en banc. The court denied the petition (App. 164a-166a), but five of the eleven participating judges suggested that the panel decision conflicts with this Court’s holding in Teva (App. 168a-176a).

Specifically, a concurrence authored by Judge Moore (joined by Judges Newman, O’Malley, and Taranto) observed that the panel had based its reversal on something that is “unquestionably a factual issue based upon extrinsic evidence”—namely, “whether one of skill in the art would know how to select from among multiple measurement techniques to determine maximum slope.” App. 175a. The concurrence criticized the panel’s decision to hold Dow’s patent claims indefinite even “after a jury verdict of no indefiniteness and without giving deference to the jury’s underlying fact findings.” Id. The four concurring judges further questioned the panel’s

14 decision to resolve the case “on a basis not only not raised by Nova … but in fact expressly disavowed by Nova.” Id. (citing Nova C.A. Br. 49; Nova C.A. Reply Br. 13-14).

The four concurring judges, plus Judge Chen, recognized that the panel decision conflicts with this Court’s “recent holding … that fact findings which rely upon extrinsic evidence must be given deference on appeal.” App. 171a (citing Teva, 135 S. Ct. at 835). And the five concurring judges observed that the panel decision conflicts with the statutory “burden of proving indefiniteness … by clear and convincing evidence,” which rests “on the party challenging validity.” App. 173a. As the concurrence noted, the panel had reversed without identifying evidence establishing “that one of skill in the art would not know how to choose among [multiple measurement techniques].” App. 174a. The concurrence did not attempt to reconcile the conflict between the panel decision and the standards set forth in Teva and Rule 50. But the concurring judges nevertheless voted to deny en banc review on the supposed ground that the panel decision did not change governing law. App. 175a.

The judges on the panel separately concurred in the denial of rehearing en banc. App. 167a. The panel judges asserted, without explanation, that the panel decision was consistent with the standards articulated in the five-judge concurrence (id.), notwithstanding that the panel had explicitly applied de novo review (App. 7a) and had never acknowledged either the requirement of deference to jury factual findings or Nova’s burden of proving the patent claims invalid by clear and convincing evidence. Like the five-judge

15 concurrence, the panel concurrence did not attempt to reconcile the decision with Teva or Rule 50.5

REASONS FOR GRANTING THE WRIT

This Court in Nautilus expressly “le[ft] … for another day” the question “whether factual findings subsidiary to the ultimate issue of definiteness trigger” deferential appellate review. 134 S. Ct. at 2130 n.10. This case presents the ideal vehicle to decide that question. In the decision below, the Federal Circuit invalidated Dow’s patent claims based on de novo review of factual findings subsidiary to the ultimate issue of definiteness. The jury had implicitly found, in rejecting Nova’s indefiniteness defense, that one of ordinary skill in the art would know how to select a measurement method for determining maximum slope—“unquestionably a factual issue based upon extrinsic evidence,” in the words of the concurrence below (App. 175a). The Federal Circuit rejected that jury finding on its own initiative without citing any record evidence or showing why “a reasonable jury would not have a legally sufficient evidentiary basis” to make that finding, as Rule 50(a) would normally require. Only by according no deference to the jury’s factual findings on definiteness could the Federal Circuit reverse the district court’s judgment.

The Federal Circuit’s refusal to defer to jury factual findings underlying a definiteness determination war-rants this Court’s review. That ruling conflicts with Teva’s holding that, in the closely analogous context of

5 Judge O’Malley, joined by Judge Reyna, dissented from the denial of rehearing en banc on the ground that the court lacked jurisdiction over the issue of definiteness as it was not at issue in the supplemental-damages proceedings. App. 177a-185a.

16 claim construction, subsidiary factual findings must be reviewed deferentially for clear error. The rationale for that decision applies at least equally to factual findings underlying a jury’s determination that a patent claim is not indefinite. Moreover, the decision below conflicts with Rule 50(a), which requires giving at least as much deference to a jury’s factual findings on definiteness as is owed to a district court’s factual findings on claim construction.

Certiorari is warranted also because certainty as to the standard of review for definiteness findings is an issue of great importance to patent litigants and the district courts. Teva has failed to ensure the Federal Circuit’s deference to district-court findings underly-ing claim construction. As the decision below illus-trates, the same is true as to findings underlying definiteness determinations. The Court should grant certiorari here to reinforce the need for such deference, and to reaffirm that there is no patent-law exception to normal rules of appellate review of factual findings.

I. THE FEDERAL CIRCUIT’S DE NOVO REVIEW OF FACTUAL FINDINGS UNDERLYING A PATENT DEFINITE-NESS DETERMINATION WARRANTS CERTIORARI

Unlike Nautilus, which did not involve “any con-tested factual matter,” 134 S. Ct. at 2130 n.10, the judgment below turned on a single dispositive factual question underlying the issue of patent claim definite-ness. The jury resolved that factual question in Dow’s favor, but the Federal Circuit reversed on de novo review, giving no deference to the jury’s factual findings. This case thus squarely presents the question reserved in Nautilus: what standard of review governs “factual findings subsidiary to the

17 ultimate issue of definiteness.” That question war-rants certiorari.

A. The Judgment Below Conflicts With Teva And Rule 50(a)

As Teva explained, there is no patent-law “excep-tion” to ordinary rules providing for deferential review of factual findings made by a district court. Teva, 135 S. Ct. at 837; cf. eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 391 (2006) (generally applicable rules “apply with equal force to disputes arising under the Patent Act”). As this Court observed, recognizing such exceptions “‘would tend to undermine the legitimacy of the district courts …, multiply appeals …, and needlessly reallocate judicial authority.’” Teva, 135 S. Ct. at 837 (quoting FED. R. CIV. P. 52 advisory committee’s note (1985)). Moreover, such exceptions “‘would very likely contribute only negligibly’ to accuracy ‘at a huge cost in diversion of judicial resources.’” Id. (quoting Anderson v. Bessemer City, 470 U.S. 564, 574-75 (1985)).

As Teva further explained, factual findings warrant deference even where the fact-finding in question relates to an ultimate legal conclusion like patent claim construction. Teva held that factual findings underlying patent claim construction must, “like all other factual determinations” made by a district judge, “be reviewed for clear error.” Id. at 838 (citations omitted). As the Court noted, such factual determina-tions may require “‘credibility judgments’ about witnesses,” id. (quoting Markman v. Westview Instruments, Inc., 517 U.S. 370, 389 (1996)), or consideration of extrinsic evidence as to how “‘technical words or phrases not commonly under-stood’” are used in a particular trade, id. at 837 (quoting Great Northern Ry. Co. v. Merchants’ Elevator

18 Co., 259 U.S. 285, 292 (1922)). The same holds true for factual findings subsidiary to the legal deter-mination of invalidity for obviousness. See Dennison Mfg. Co. v. Panduit Corp., 475 U.S. 809, 811 (1986) (per curiam), cited in Teva, 135 S. Ct. at 838.

The Federal Circuit’s decision here warrants review because it departs from Teva’s clear holding. There is no basis to treat claim construction and definiteness determinations differently when reviewing their underlying factual findings. To the contrary, deter-mining the meaning of a patent claim closely resembles determining whether a patent claim informs a skilled artisan of its scope with reasonable certainty. Both are legal questions regarding the meaning of patent claims, predicated on underlying issues of fact. (Teva itself came to this Court as a dispute over definiteness. See 135 S. Ct. at 836.) Moreover, like claim construction and obviousness, the ultimate legal question of definiteness often turns on factual issues such as the knowledge of a skilled artisan. See Nautilus, 134 S. Ct. at 2129 (definiteness “require[s] that a patent’s claims … inform those skilled in the art about the scope of the invention with reasonable certainty”). Thus, just as with a district court’s factual findings underlying claim construction, see Teva, 135 S. Ct. at 836-37, deference to a jury’s definiteness findings promotes judicial economy and uniform application of the Federal Rules of Civil Procedure. See Jonas Anderson & Peter S. Menell, Restoring the Fact/Law Distinction in Patent Claim Construction, 109 NW. U.L. REV. ONLINE 187, 199 (2015) (explaining that, while Teva addressed the standard of review for claim construction, the same standard should apply in definiteness cases by analogy).

19 Indeed, deferential review is if anything more

appropriate with respect to factual findings underly-ing definiteness than to factual findings underlying claim construction. First, the Patent Act requires that an affirmative defense like indefiniteness be proved by clear and convincing evidence. See 35 U.S.C. 282; Microsoft, 131 S. Ct. at 2242. Second-guessing a fact-finder’s conclusion under such a demanding burden of proof is especially intrusive upon the factfinder’s role.

Second, factual findings underlying a definiteness determination are often (as here) made by a jury rather than by a district court. But Rule 50 permits a court to set aside a jury’s factual findings only if “a reasonable jury would not have a legally sufficient evidentiary basis to find for the party on that issue,” FED. R. CIV. P. 50(a)(1)—that is, only if no reasonable jury could have reached the actual jury’s conclusion. The Rule 50 standard, unlike the Rule 52 clear-error standard applied in Teva, has constitutional dimen-sion, for it secures the Seventh Amendment’s jury-trial right. See Galloway v. United States, 319 U.S. 372, 396 (1943) (Seventh Amendment “requires that the jury be allowed to make reasonable inferences from facts proven in evidence having a reasonable tendency to sustain them”) (emphasis added). Rule 50 thus requires a reviewing court to “draw all reasonable inferences in favor of” a jury verdict and to “disregard all evidence favorable to the moving party that the jury is not required to believe,” while prohibiting “credibility determinations” and attempts to “weigh the evidence.” Reeves, 530 U.S. at 150-51.

The Federal Circuit disregarded the panel decision’s plain conflicts with Teva and Rule 50. Upon denial of rehearing en banc, five judges highlighted those conflicts (see App. 168a-175a), but concurred in the

20 denial. And the panel made no attempt to harmonize its decision with Teva or Rule 50. To the contrary, the panel judges asserted in a separate concurrence in the denial of rehearing (App. 167a) that the panel decision had “directly applie[d]” the legal standards discussed in the five-judge concurrence—without explaining how it could have done so when it never acknowledged those standards and expressly applied de novo rather than deferential review. The panel cited Nautilus (App. 18a, 24a-25a), but Nautilus did not speak to the question presented here—namely, whether deference is required to factual findings based on extrinsic evidence of the knowledge possessed by a person of ordinary skill in the art.6

Thus, this Court should grant certiorari to resolve the conflict between the decision below and Teva and Rule 50 and to answer the question left open by Nautilus—whether factual findings subsidiary to the issue of patent definiteness must be reviewed with deference.

6 The Federal Circuit also sought (App. 24a-25a) to analogize

to its decision on remand in Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc. (“Teva II”), 789 F.3d 1335 (Fed. Cir. 2015). But that decision is inapposite: Teva II held a patent claim indefinite under Nautilus because of ambiguity in the term “molecular weight,” which could mean either of two entirely different facts about a given molecule—either its “peak average molecular weight” or its “weight average molecular weight.” See id. at 1338, 1340, 1344-45; Teva, 135 S. Ct. at 836. Here, by contrast, a person of ordinary skill in the art would know that every measurement method is directed to the same objective fact—the single maximum slope of a sample’s stress/strain curve. And the evidence likewise permitted a reasonable jury to find that a skilled artisan would know how to measure that slope in a given case. See supra, at 7-9.

21 B. This Case Presents An Excellent

Vehicle For Certiorari

Without question, the Federal Circuit here reversed on indefiniteness by coming to the opposite conclusion than the jury on a determinative factual question: whether a skilled artisan would know how to measure the maximum slope of a stress/strain curve. See App. 21a-24a.7 The patent does not expressly identify a slope-measurement method, so whether the claims are definite depends on whether a person of ordinary skill in the art could identify such a method. In the words of the four-judge concurrence below, “[t]he question of whether one of skill in the art would know which measurement method to use to determine the maxi-mum slope of a curve is unquestionably a factual issue based upon extrinsic evidence.” App. 175a (emphasis added).

As this Court explained in Teva, a determination about “how a skilled artisan would understand” an un-defined term is a “factual finding.” 135 S. Ct. at 843; see, e.g., KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 427 (2007) (treating level of ordinary skill in the art as factual issue); Graham v. John Deere Co. of Kansas City, 383 U.S. 1, 17 (1966) (the “level of ordinary skill in the pertinent art” is a “basic factual inquir[y]”); Harries v. Air King Prods. Co., 183 F.2d 158, 164 (2d

7 That the jury’s factual determination was implied rather than

explicit does not affect the Rule 50 standard. See App. 175a (opinion of Moore, J.); Circuit Check Inc. v. QXQ Inc., 795 F.3d 1331, 1334 (Fed. Cir. 2015); Kroshnyi v. U.S. Pack Courier Servs., Inc., 771 F.3d 93, 106 (2d Cir. 2014); Sanofi-Aventis Deutschland GmbH v. Glenmark Pharm. Inc., USA, 748 F.3d 1354, 1358 (Fed. Cir. 2014); Acosta v. City & Cty. of San Francisco, 83 F.3d 1143, 1147 (9th Cir. 1996); Starceski v. Westinghouse Elec. Corp., 54 F.3d 1089, 1100 (3d Cir. 1995).

22 Cir. 1950) (L. Hand, C.J.) (“how the art understood the [claim] term … was plainly a question of fact”), quoted in Teva, 135 S. Ct. at 838. The Federal Circuit nonetheless rejected the jury’s implicit finding that a skilled artisan would know how to measure the maximum slope of a curve, holding the patent claims indefinite absent express guidance “as to which method should be used” to determine the maximum slope. App. 23a-24a. In overturning the jury’s resolution of the dispositive factual question, the Federal Circuit cited Teva only in a passing footnote (App. 24a n.9), expressly applied de novo review (App. 7a), and never purported to adopt the deferential Rule 50 standard.

Under ordinary Rule 50(a) review, the Federal Circuit would have had to affirm the judgment of no indefiniteness in deference to the jury’s factual findings underlying that judgment. First, Dow was entitled under Section 282 to a presumption that its patent claims are valid. The jury was thus required to presume (absent clear and convincing contrary evidence) that the PTO had correctly concluded in issuing the patent that a skilled artisan would know how to measure the maximum slope of a curve. See 35 U.S.C. 282; Microsoft, 131 S. Ct. at 2242.

Second, ample extrinsic evidence supported the jury’s conclusion, including the trial testimony of both Dow’s and Nova’s experts. That evidence showed that a skilled artisan would know where to measure the slope in order to observe a sample’s “true strain hardening effect” (App. 207a; see App. 205a-207a, 225a)—namely, at the maximum slope. As Nova’s expert agreed, a given curve has “only one true maximum slope.” App. 245a; see App. 209a. And ample evidence also supported the conclusion that, as

23 Nova’s expert admitted, “persons in the art know how to determine maximum slopes.” App. 244a (emphasis added). While there may be different methods for approximating the “true maximum slope,” there was no dispute that a skilled artisan armed with a pencil, a ruler, and a calculator could determine it for a given curve. See App. 212a-213a; App. 233a-234a. There was also substantial evidence from which a reasonable jury could conclude that a skilled artisan would know how to disregard incorrect results and choose the correct method. See, e.g., App. 216a-222a, 194a-196a.

Third, Nova supplied no evidence to contradict these showings and override the presumption of validity, even though it bore the burden of proving indefi-niteness by clear and convincing evidence. To the contrary, Nova’s expert agreed that a person of ordinary skill in the art would know how to measure maximum slope. See App. 244a. Thus, Nova conceded on appeal that “one skilled in the art could physically locate and calculate the ‘maximum slope’ on a stress/strain curve if the artisan knew that such a ‘maximum slope’ approach was called for by the patents-in-suit.” Nova C.A. Reply Br. 13-14; see Nova C.A. Br. 49 (similar).

Accordingly, there can be no doubt that a reasonable jury could find, based on the presumption of validity and the evidence and burdens at trial, that a skilled artisan would have the knowledge required to under-stand the meaning of Dow’s claims with reasonable certainty. The Federal Circuit reached the opposite conclusion only by refusing any deference to the jury’s findings and disregarding Nova’s burden of proof.

This case thus presents an excellent vehicle for reconciling review of factual findings in the definite-ness context with both Teva and Rule 50. The record

24 here contains zero evidence that a skilled artisan would lack the knowledge necessary to understand the claims, much less the clear and convincing evidence needed to overcome the presumption of claim validity. Nova did not even raise such an argument as to the method-of-measurement issue on which the Federal Circuit reversed. The Court thus should grant review to answer the question left open in Nautilus and to correct the Federal Circuit’s error in disregarding Teva and Rule 50.

Indeed, in light of this Court’s recent decision in Teva, from which it may readily be inferred that deference is required to factual findings underlying definiteness determinations, Dow respectfully sub-mits that summary reversal would be appropriate. See, e.g., Amgen Inc. v. Harris, 136 S. Ct. 758, 759-60 (2016) (per curiam) (summarily reversing where court of appeals failed properly to apply newly announced precedent); CSX Transp., Inc. v. Hensley, 556 U.S. 838, 839 (2009) (per curiam) (summarily reversing where court below “misread and misapplied” controlling decision); Dennison, 475 U.S. at 811 (summarily vacating where Federal Circuit reversed obviousness ruling without applying Rule 52(a)), cited with approval in Teva, 135 S. Ct. at 838, 840; STEPHEN M. SHAPIRO ET AL., SUPREME COURT PRACTICE 345 & n.96 (10th ed. 2013) (collecting decisions summarily reversing “failures … to heed Court precedents respecting … appellate review of FELA jury verdicts”).

25 II. REVIEW OF PATENT DEFINITENESS

FINDINGS IS AN IMPORTANT AND RECURRING ISSUE ON WHICH THE FEDERAL CIRCUIT IS DEEPLY FRACTURED

The question presented is one of great importance to patent litigants and the district courts, and will arise in every definiteness appeal in which a jury or district court has made a material finding of fact. Because the Federal Circuit has nationwide jurisdiction over patent cases, its inability to resolve the question presented here makes this Court’s review all the more important. And the Federal Circuit’s failure to adhere consistently to Teva in the claim-construction context increases the likelihood that the confusion created by the decision below will persist in the definiteness context absent this Court’s review.

In the claim-construction context, Teva has failed to bring about deferential review of fact findings underlying claim construction except “in very limited circumstances.”8 Commentators correctly predicted that the Federal Circuit would avoid Teva’s holding by reverting to “de facto de novo review.”9 As commenta-tors have observed, the Federal Circuit has continued to do “exactly what it did pre-Teva”: applying “a de novo standard of review, brushing aside extrinsic evidence where it contradicts, relying on it where it

8 Stacey Cohen & William Casey, 1 Year Later, Teva Providing

Less Certainty Than Expected, LAW360 (Jan. 19, 2016), http:// www.law360.com/appellate/articles/651341.

9 Dennis Crouch, Giving Deference to the Supreme Court in Teva v. Sandoz, PATENTLY-O (Jan. 21, 2015), http://patentlyo.com /patent/2015/01/deference-supreme-sandoz.html.

26 supports and not giving so much as a whiff of formal deference.”10

For example, even after this Court vacated CardSoft v. Verifone, Inc., 769 F.3d 1114, 1118 (Fed. Cir. 2014), vacated, 135 S. Ct. 2891 (2015), for improper de novo review of extrinsic evidence, the Federal Circuit again undertook de novo review of the district court’s claim construction on the supposed basis that the “intrinsic record fully determines the proper scope of the disputed claim terms,” CardSoft, LLC v. VeriFone, Inc., 807 F.3d 1346, 1350 (Fed. Cir. 2015); see also Enzo Biochem Inc. v. Applera Corp., 780 F.3d 1149, 1156 (Fed. Cir. 2015) (overruling district court finding, based on extrinsic evidence, as to the meaning of a claim term); id. at 1159 (Newman, J., dissenting) (criticizing majority’s failure to give district court’s “factual findings” deference due “in accordance with the Court’s instruction in Teva”).

The same is proving true for factual findings under-lying definiteness determinations. For instance, in Eidos Display, LLC v. AU Optronics Corp., 779 F.3d 1360 (Fed. Cir.), cert. denied, 136 S. Ct. 502 (2015), the Federal Circuit reversed a judgment of invalidity based on indefiniteness. The district court had found, based on extrinsic evidence, that a person of ordinary skill in the art would not understand certain claim terms. See id. at 1364. The Federal Circuit disagreed, determining de novo what “a person of ordinary skill in the art would understand.” Id. at 1367.11

10 Jason Rantanen, Teva, Nautilus, and Change Without

Change, 18 STAN. TECH. L. REV. 430, 448 (2015). 11 The petition for certiorari that was denied in Eidos did not

present the question at issue here, but rather a question concerning an exception to Teva in the claim-construction con-

27 And on remand in Teva itself, the Federal Circuit

held the asserted patent claim indefinite by rejecting the district court’s finding—based in part on infer-ences drawn from evaluation of extrinsic evidence—as to how a skilled artisan would understand the term “molecular weight.” Teva II, 789 F.3d at 1342. The court characterized the issue as one of law, see id., but the dissent protested the majority’s “failure to afford sufficient deference to the trial court’s findings of fact,” id. at 1346 (Mayer, J., dissenting); see id. at 1348 (criticizing majority for “first embarking on an independent review of the record and then consider-ing, as an afterthought, the important and carefully considered factual findings made by the trial court”).

While the Federal Circuit has deferred to district-court factual findings concerning definiteness in some cases, see, e.g., Akzo Nobel Coatings, Inc. v. Dow Chem. Co., 811 F.3d 1334, 1343-44 (Fed. Cir. 2016), its decisions remain inconsistent. Akzo Nobel affirmed a finding of no indefiniteness based on deference to district-court findings regarding a skilled artisan’s understanding, but Teva II, as noted, declined such deference and found patent claims indefinite over a forceful dissent. And the issue is likely to recur with increasing frequency: In the 13 months since this Court decided Teva, the Federal Circuit has reviewed lower-court factual findings subsidiary to definiteness determinations in at least five cases. See Akzo Nobel, 811 F.3d at 1343-44; Ethicon Endo-Surgery, Inc. v. Covidien, Inc., 796 F.3d 1312, 1317 (Fed. Cir. 2015); Teva II, 789 F.3d at 1341; EON Corp. IP Holdings LLC v. AT&T Mobility LLC, 785 F.3d 616, 620 (Fed. Cir.

text. See Pet. for Writ of Cert., Chunghwa Picture Tubes, Ltd. v. Eidos Display, LLC, No. 15-288 (Sept. 8, 2015).

28 2015); Biosig Instruments, Inc. v. Nautilus, Inc., 783 F.3d 1374, 1377 (Fed. Cir. 2015).

Moreover, the standard of review at issue here has broader implications for patent law. For example, the affirmative defenses of obviousness and double pa-tenting, like the affirmative defense of indefiniteness, involve legal conclusions based on underlying factual determinations. E.g., Abbvie Inc. v. Mathilda & Terence Kennedy Inst. of Rheumatology Trust, 764 F.3d 1366, 1372 (Fed. Cir. 2014) (double-patenting); Power Integrations, Inc. v. Fairchild Semiconductor Int’l, Inc., 711 F.3d 1348, 1356 (Fed. Cir. 2013) (obviousness).

By declining en banc review in this case, the Federal Circuit deepened the uncertainty and inconsistency surrounding application of Teva to factual findings based on extrinsic evidence. The decision below, and the concurrence’s acquiescence in its departure from Teva, thus undermine the “‘uniformity in patent law’” that the Federal Circuit was established to promote. Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141, 162 (1989) (quoting H.R. Rep. No. 97-312, p. 20 (1981)). While the Federal Circuit’s exclusive juris-diction in patent cases means that there will be no circuit split on the important question presented here, the ongoing but unpredictable splintering of the Federal Circuit provides additional reason for this Court to grant review.

Finally, the question presented here is particularly important because it implicates the Seventh-Amendment jury-trial right. This Court granted certiorari in Teva to resolve the question whether the Rule 52(a) clear-error standard applies to district-court claim-construction findings—an issue implicat-ing prudential goals concerning judicial economy, see

29 135 S. Ct. at 837-38. Here, resolving whether Rule 50(a)’s substantial-evidence standard applies to definiteness findings implicates those goals and the constitutional right to a jury trial, see Galloway, 319 U.S. at 396.

Certiorari is thus warranted to resolve the important and recurring question presented.

CONCLUSION

The petition should be granted and the judgment below summarily reversed. Alternatively, the petition should be granted and the case set for briefing and argument.

Respectfully submitted,

HARRY J. ROPER AARON A. BARLOW PAUL D. MARGOLIS JENNER & BLOCK LLP 353 North Clark Street Chicago, IL 60654 (312) 222-9350

KATHLEEN M. SULLIVAN Counsel of Record

RAYMOND N. NIMROD WILLIAM B. ADAMS CLELAND B. WELTON II QUINN EMANUEL URQUHART

& SULLIVAN, LLP 51 Madison Avenue 22nd Floor New York, NY 10010 (212) 849-7000 kathleensullivan@ quinnemanuel.com

Counsel for Petitioner

March 16, 2016

APPENDIX

1a APPENDIX A

UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT

————

2014-1431, 2014-1462

————


Plaintiff-Cross-Appellant

v.

NOVA CHEMICALS CORPORATION (CANADA), NOVA CHEMICALS INC. (DELAWARE),

Defendants-Appellants

————

Appeals from the United States District Court for the District of Delaware in No. 1:05-cv-00737-LPS,

Chief Judge Leonard P. Stark.

————

Decided: August 28, 2015

————

HARRY J. ROPER, Jenner & Block LLP, Chicago, IL, argued for plaintiff-cross-appellant. Also represented by, AARON A. BARLOW, PAUL DAVID MARGOLIS; RAYMOND N. NIMROD, GREGORY D. BONIFIELD, WILLIAM ADAMS, CLELAND B. WELTON, II, Quinn Emanuel Urquhart & Sullivan, LLP, New York, NY.

DONALD ROBERT DUNNER, Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, Washington, DC, argued for defendants-appellants. Also represented by

2a MARK J. FELDSTEIN, RONALD BLEEKER, DARREL CHRISTOPHER KARL.

————

Before PROST, Chief Judge, DYK and WALLACH, Circuit Judges.

DYK, Circuit Judge.

The Dow Chemical Company (“Dow”) filed suit against NOVA Chemicals Corporation (Canada) and NOVA Chemicals Inc. (Delaware) (collectively, “NOVA”), alleging infringement of claims of U.S. Patent No. 5,847,053 (the “’053 patent”) and U.S. Patent No. 6,111,023 (the “’023 patent”). A jury found the asserted claims to be infringed and not invalid. NOVA appealed, and we affirmed, holding, inter alia, that the asserted claims were not indefinite. Our mandate issued, and NOVA’s petition for certiorari was denied by the Supreme Court, NOVA Chems. Corp. v. Dow Chem. Co., 133 S. Ct. 544 (2012). The district court subsequently conducted a bench trial for the supplemental damages period through the expiration date of both patents. The district court granted supplemental damages in the form of lost profits and reasonable royalties and denied Dow’s request for enhanced damages. NOVA appealed, and Dow cross-appealed.

Subsequently, the Supreme Court decided Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120 (2014), altering the standard for indefiniteness. We consider here only whether, under Nautilus, the supplemental damages award must be reversed because the claims

3a are indefinite. NOVA does not request that we reopen our previous judgment as to the infringement trial.1

We hold that the intervening change in the law of indefiniteness resulting from Nautilus provides an exception to the doctrine of law of the case or issue preclusion. In our review of the supplemental damages award, we therefore evaluate the indefiniteness of the claims under the Nautilus standard. In reviewing the supplemental damages award under the Nautilus standard, we hold that the claims are indefinite and reverse the award of supplemental damages.

BACKGROUND

On October 21, 2005, Dow filed suit against NOVA, alleging infringement of claims of the ’053 patent and the ’023 patent. The asserted claims of both patents cover ethylene polymer compositions (a type of plastic) with, inter alia, improved modulus, yield strength, impact strength, and tear strength. These polymers can be made into films that can be down-gauged (made thinner) without losing strength. The claims at issue are independent claim 62 and dependent claims 7, 10,

1 NOVA did attack that judgment in a separate case, alleging

fraud and fraud on the court. We affirmed the district court’s dismissal of NOVA’s complaint. See NOVA Chems. Corp. v. Dow Chem. Co., No. 2015-1257, 2015 WL 3555764 (Fed. Cir. June 9, 2015); Transcript of Hearing on Motion to Dismiss at 56, NOVA Chems. Corp. v. Dow Chem. Co., No. 13-1601-LPS (D. Del. July 29, 2014).

2 Claim 6 is representative and provides:

6. An ethylene polymer composition comprising (A) from about 10 percent (by weight of the total composition) to about 95 percent (by weight of the total composition) of at least one homogeneously branched linear ethylene/α-olefin interpolymer having:

4a and 12 of the ’053 patent; and independent claim 13 and dependent claims 2, 5, and 8 of the ’023 patent. Both patents expired on October 15, 2011.

(i) a density from about 0.89 grams/cubic centimeter (g/cm3) to about 0.935 g/cm3,

(ii) a molecular weight distribution (Mw /Mn) from about 1.8 to about 2.8,

(iii) a melt index (I2) from about 0.001 grams/10 minutes (g/10 min) to about 10 g/10 min,

(iv) no high density fraction,

(v) a single melting peak as measured us-ing differential scanning calorimetry, and

(vi) a slope of strain hardening coefficient greater than or equal to 1.3; and

(B) from about 5 percent (by weight of the total composition) to about 90 percent (by weight of the total composition) of at least one heterogeneously branched linear ethylene polymer having a density from about 0.93 g/cm3 to about 0.965 g/cm3.

’053 patent col. 16 ll. 4–25. 3 Claim 1 is representative and provides:

1. An ethylene polymer composition comprising

(A) from about 10 percent (by weight of the total composition) to about 95 percent (by weight of the total composition) of at least one ethylene interpolymer having:

(i) a density from about 0.89 grams/cubic centimeter (g/cm3) to about 0.935 g/cm3,

(ii) a melt index (I2) from about 0.001 grams/10 minutes (g/10 min.) to about 10 g/10 min.,

(iii) a slope of strain hardening co-efficient greater than or equal to 1.3, and

(iv) a Composition Distribution Branch Index (CDBI) greater than 50 percent; and

(B) from about 5 percent (by weight of the total composition) to about 90 percent (by weight of the total composition) of at least one ethylene polymer characterized as having a

5a Relevant here, claim 6 of the ’053 patent and claim

1 of the ’023 patent, the independent claims, require “a slope of strain hardening coefficient greater than or equal to 1.3.” ’053 patent col. 16 ll. 19–20; ’023 patent col. 16 ll. 29–30. NOVA argues that the patents are indefinite because they fail to teach a person having ordinary skill in the art how to measure the “slope of strain hardening,” which is required to calculate the strain hardening coefficient.

On June 15, 2010, a jury found that NOVA infringed the claims of the asserted patents and that the patents were not invalid for indefiniteness. The jury had been instructed that “[i]f the meaning of the claims is discernible, it is definite, even though the task may be formidable and even if the conclusion may be one over which reasonable persons will disagree.” J.A. 12702. NOVA appealed, arguing, inter alia, that the patents were invalid for indefiniteness. Dow Chem. Co. v. Nova Chems. Corp., 458 F. App’x 910, 911, 917–18 (Fed. Cir. 2012). In that previous appeal, on January 24, 2012, we held that the patents were not indefinite. Id. at 911, 920. In so holding, we applied the law as then established by our pre-Nautilus precedent, including Exxon Research & Engineering Co. v. United States, 265 F.3d 1371 (Fed. Cir. 2001). See Dow, 458 F. App’x at 917–20.

On remand, the district court, inter alia, held a bench trial on supplemental damages for the period between January 1, 2010, through October 15, 2011, the date on which the patents expired. On March 28,

density from about 0.93 g/cm3 to about 0.965 g/cm3 and comprising a linear polymer fraction, as determined using a temperature rising elution fractionation (TREF) technique.

’023 patent col. 15 l. 59–col. 16 l. 39.

6a 2014, the district court granted supplemental dam-ages to Dow in the form of lost profits and reasonable royalties and denied Dow’s request for enhanced damages. Final judgment was entered on April 14, 2014. NOVA appealed on April 23, 2014. Dow cross-appealed on May 1, 2014.

While the appeals were pending, on June 2, 2014, the Supreme Court decided Nautilus. In Nautilus, the Supreme Court held that our standard for indefinite-ness was contrary to 35 U.S.C § 112, and it announced a new standard described in detail below. See 134 S. Ct. at 2124. The Court abrogated our previous inquiry into whether the claims were “amenable to construc-tion” or “insolubly ambiguous,” id., which we applied in cases such as Exxon, and relied on in the earlier appeal in this case, Dow, 458 F. App’x at 917, 919–20. Under the new standard, “a patent is invalid for indefiniteness if its claims, read in light of the specification delineating the patent, and the prosecu-tion history, fail to inform, with reasonable certainty, those skilled in the art about the scope of the invention.” Nautilus, 134 S. Ct. at 2124.

On appeal, NOVA argues that (1) the supplemental damages award should be vacated because the patents-insuit are invalid for indefiniteness after the Supreme Court’s decision in Nautilus or (2) in the alternative, the supplemental damages award was not supported by the evidence. In its cross-appeal, Dow contends that the district court erred by not awarding enhanced damages for the supplemental damages period.

We have jurisdiction pursuant to 28 U.S.C. § 1295 (a)(1). 35 U.S.C. § 112 ¶ 2 provides that “[t]he spec-ification shall conclude with one or more claims particularly pointing out and distinctly claiming the

7a subject matter which the applicant regards as his invention.” 35 U.S.C. § 112 (2006). Indefiniteness is a question of law that this court reviews de novo. Teva Pharm. USA, Inc. v. Sandoz, Inc., 789 F.3d 1335, 1341 (Fed. Cir. 2015).

We conclude that our prior decision is not binding on the issue of indefiniteness because Nautilus changed the applicable law, our prior decision rested on the earlier law, and the patents-in-suit are invalid for indefiniteness under the new Nautilus standard. We do not address the other issues. We reverse the district court’s award of supplemental damages and dismiss the cross-appeal as moot.

DISCUSSION

I

Dow argues that we are bound by our decision in the previous appeal—an appeal from a final judgment under Federal Rule of Civil Procedure 54(b)—that the claims were not indefinite. While a judgment entered under Rule 54(b) is a final judgment, that final judgment cannot have any greater effect than any other final judgment. The earlier appeal was from the entry of judgment in the jury verdict (for the period March 2002–December 31, 2009) while the current appeal is from the supplemental damages judgment (for the period January 1, 2010–October 15, 2011). An award of supplemental damages is designed to com-pensate the patentee “for periods of infringement not considered by the jury,” Whitserve, LLC v. Comput. Packages, Inc., 694 F.3d 10, 38 (Fed. Cir. 2012) (emphasis added), and necessarily implicates patent validity. In order to prevail on a claim for supple-mental damages, a patentee must establish infringe-ment for the supplemental damages period. If “an act

8a that would have been an infringement or an inducement to infringe pertains to a patent that is shown to be invalid, there is no patent to be infringed.” Commil USA, LLC v. Cisco Sys., Inc., 135 S. Ct. 1920, 1929 (2015).

The doctrine of claim preclusion does not apply as between the claims for the first and second damages periods. It is well-established that, as to claims for continuing conduct after the complaint is filed, each period constitutes a separate claim.4 See 18 Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 4409 (2d ed. 2002) (“A substantially single course of activity may continue through the life of a first suit and beyond. The basic claim-preclusion result is clear: a new claim or cause of action is created as the conduct continues.”); Crowe v. Leeke, 550 F.2d 184, 187 (4th Cir. 1977) (“We glean from the[] cases that res judicata [claim preclusion] has very little applicability to a fact situation involving a continuing series of acts, for

4 Likewise, claims that have accrued at the time of the complaint generally must be brought together, and the plaintiff need not supplement the complaint to cover continuing conduct. 18 Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 4409 (2d ed. 2002) (“Most cases rule that an action need include only the portions of the claim due at the time of commencing that action, frequently observing that the opportunity to file a supplemental complaint is not an obligation.”); see also, e.g., Gillig v. Nike, Inc., 602 F.3d 1354, 1363 (Fed. Cir. 2010) (res judicata [claim preclusion] does not apply where claims accrue during action and are not the subject of the first judgment because “the doctrine of res judicata does not punish a plaintiff for exercising the option not to supplement the pleadings with an after-acquired claim” (citations omitted)); Spiegel v. Cont’l Ill. Nat’l Bank, 790 F.2d 638, 646 (7th Cir. 1986) (claim preclusion barred suit except for claims related to two new acts which “occurred after the filing” of the earlier suit).

9a generally each act gives rise to a new cause of action.”); Exhibitors Poster Exchange, Inc. v. Nat’l Screen Serv. Corp, 421 F.2d 1313, 1316, 1318–19 (5th Cir. 1970) (res judicata [claim preclusion] does not apply where plaintiff alleges “same facts—[a] 1961 refusal to deal [as an antitrust violation]”—but sought in a second and third suit to recover damages suffered since losing on summary judgment in the first suit since the dam-ages arose from “non actions” subsequently occurring).

This rule applies to patent infringement claims. As we explained just last year,

traditional notions of claim preclusion do not apply when a patentee accuses new acts of infringement, i.e., post-final judgment, in a second suit—even where the products are the same in both suits. Such claims are barred under general preclusion principles only to the extent they can be barred by issue preclusion, with its attendant limitations.

Brain Life, LLC v Elekta Inc., 746 F.3d 1045, 1056 (Fed. Cir. 2014); see Aspex Eyewear, Inc. v. Marchon Eyewear, Inc., 672 F.3d 1335, 1342–44 (Fed. Cir. 2012); see also, e.g., SynQor, Inc. v. Artesyn Techs., Inc., 709 F.3d 1365, 1385–86 (considering whether intent element of induced infringement had been shown in the supplemental damages period).

Here, the bulk of the supplemental damages accrued after the Rule 54(b) judgment, and it is clear that claim preclusion also does not apply to damages accruing after the filing of the complaint and not the subject of the first judgment. See note 4, supra. All supplemental damages here accrued after the filing of the complaint.

10a While claim preclusion does not apply, ordinarily

issue preclusion (or law of the case) would bar relitigation in the supplemental damages period of issues (such as validity) that were resolved as to the earlier time periods. 18 Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 4409 (2d ed. 2002 (“[Although] claim preclusion often cannot apply in settings of continuing . . . conduct, . . . it may be proper to conclude that the issues precluded by the first litigation embrace [issues in the second] . . . .”). That would be the case whether the supplemental damages proceeding were viewed as a continuation of the ongoing case or as a new proceeding.5 In the former event, the doctrine of law of the case would preclude relititgation. In the latter event (treating the supplemental damages proceeding as a new proceeding) issue preclusion would bar relitigation. “[T]he doctrine [of law of the case] posits that when a court decides upon a rule of law, that decision should continue to govern the same issues in subsequent stages in the same case.” Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 815–16

5 Because Dow does not seek to reopen the in-fringement trial

judgment, Dow’s arguments that we lack jurisdiction on the indefiniteness issue are without merit. The cases that Dow cites relate to situations where a party sought to reopen a previous judgment. See Brown v. Eli Lilly & Co., 654 F.3d 347, 354–55 (2d Cir. 2011) (holding that court was without jurisdiction to consider appeal as to two parties because the judgment against one party was appealed but the appeal was dismissed as untimely and the judgment against the other party was not appealed); In re Martin, 400 F.3d 836, 841 & n.1 (10th Cir. 2005) (appeal limited to later order because earlier order was a final judgment and that judgment was not appealed); Crowder v. Telemedia, Inc., 659 F.2d 787, 787– 88 (7th Cir. 1981) (per curiam) (holding that court lacked jurisdiction over previous judgment that had become final and had not been timely appealed).

11a (1988) (quoting Arizona v. California, 460 U.S. 605, 618 (1983)) (emphasis added) (alterations in original). Issue preclusion “bars ‘successive litigation of an issue of fact or law already litigated and resolved in a valid court determination essential to the prior judgment.’” Taylor v. Sturgell, 553 U.S. 880, 892 (2008) (quoting New Hampshire v. Maine, 532 U.S. 742, 748–49 (2001)) (emphasis added).6 But both doctrines are subject to an exception—when governing law is changed by a later authoritative decision. See 18B Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 4478 (2d ed. 2002) (law of the case); 18 Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 4425 (2d ed. 2002) (issue preclusion).

With respect to law of the case, “[p]erhaps the most obvious justifications for departing . . . arise when there has been an intervening change of law outside the confines of the particular case.” 18B Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 4478; see Rose Acre Farms, Inc. v. United States, 559 F.3d 1260, 1277–78 (Fed. Cir. 2009) (holding that intervening Supreme Court decision issued after prior appeal rendered prior decision “obsolete,” “[g]iven the significant change in the law”); Wopsock v. Natchees, 454 F.3d 1327, 1333 (Fed. Cir. 2006) (finding that law of the case did not

6 While we apply the law of the regional circuit to general

procedural questions, we apply this court’s precedent to questions implicating substantive issues of patent law or issues implicating the scope of our own previous decisions. See Soverain Software LLC v. Victoria’s Secret Direct Brand Mgmt., LLC, 778 F.3d 1311, 1314 (Fed. Cir. 2015). We therefore apply our own law where, as here, we are interpreting our own prior decision.

12a apply because “this is a case in which there has been a change in the law”). The exception applies even if the issue was resolved on appeal in an earlier stage of the proceeding. Indeed, the premise of the exception in the appellate context is that there was such an earlier resolution. See Litton Sys., Inc. v. Honeywell Inc., 238 F.3d 1376, 1379–81 (Fed. Cir. 2001) (revisiting prior holding on prosecution history estoppel because intervening en banc authority adopted a contrary approach, noting “[w]e are aware of no decision of this court that has applied the law of the case in the face of a relevant change in controlling legal authority”); Mendenhall v. Barber-Greene Co., 26 F.3d 1573, 1576, 1580, 1583 (Fed. Cir. 1994) (holding that an exception to law of the case applied and the asserted claims were invalid, revisiting a previous final decision that the claims were not invalid); see also United States v. Plugh, 648 F.3d 118, 121–24 (2d Cir. 2011) (revisiting holding on first appeal due to intervening Supreme Court precedent); Spiegla v. Hull, 481 F.3d 961, 963–67 (7th Cir. 2007) (holding that “because the judgment in this case is not yet final, we are obliged to reevaluate” a previous appellate holding under inter-vening Supreme Court precedent); United States v. Windom, 82 F.3d 742, 746, 748–49 (7th Cir. 1996), vacated on other grounds, 103 F.3d 523 (7th Cir. 1996) (holding that defendant was “not foreclosed from re-raising” merits of conviction previously affirmed where an intervening Supreme Court decision was issued after remand for sentencing); United States v. Garcia, 77 F.3d 274, 276–77 (9th Cir. 1996) (recon-sidering affirmance of conviction sua sponte in light of intervening authority after an earlier remand “for the limited purpose of reimposing the mandatory” sen-tence). But the exception of course does not apply if the proceeding has reached the stage of final judgment.

13a See Mendenhall, 26 F.3d at 1582 (Fed. Cir. 1994). Here, the supplemental damages proceeding had not been concluded at the time of Nautilus.

Similarly, issue preclusion does not apply where “a new determination is warranted in order to take account of an intervening change in the applicable legal context or otherwise to avoid inequitable admin-istration of the laws.” Restatement (Second) of Judg-ments § 28(2) (1982). Therefore, a court is not bound by a previous decision where there is a change in the controlling precedent. 18 Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 4425 (“Preclusion is most readily defeated by specific Supreme Court overruling of precedent relied upon in reaching the first decision.”); see Bobby v. Bies, 556 U.S. 825, 836 (2009) (“[E]ven if the core requirements for issue preclusion had been met, an exception to the doctrine’s application would be warranted due to this Court’s intervening decision . . . .”); Bingaman v. Dep’t of Treasury, 127 F.3d 1431, 1438 (Fed. Cir. 1997) (“In a number of cases, this court and others have held that a significant change in the ‘legal atmosphere’—whether in the form of new legislation, a new court decision, or even a new administrative ruling—can justify a later court’s refusal to give collateral estoppel effect to an earlier decision.”); Wilson v. Turnage, 791 F.2d 151, 156–57 (Fed. Cir. 1986) (holding that issue preclusion did not apply where Federal Circuit decision was “such an intervening change in the legal atmosphere that it renders the bar of collateral estoppel inapplicable in this case”); see also Comm’r of Internal Revenue v. Sunnen, 333 U.S. 591, 600 (1948) (“[A] supervening decision cannot justly be ignored by blind reliance upon the rule of collateral estoppel”).

14a The change in law exception applies whether the

change in law occurs while the case is before the district court or while the case is on appeal. See Spiegla, 481 F.3d at 964 (7th Cir. 2007) (holding that defendants had not waived challenge to holding in first appeal where issue not raised on remand in district court or initial briefing because intervening decision was issued after appellate briefing); Mendenhall, 26 F.3d at 1583 (law of the case did not apply where new decision issued while case on ap-peal); Morris v. Am. Nat’l Can Corp., 988 F.2d 50, 51–53 (8th Cir. 1993) (law of the case did not apply where, after first appeal and decision on remand by district court, Supreme Court case changed prevailing law); Wilson, 791 F.2d at 154, 157 (exception to issue preclusion applied where intervening decision issued while case pending before this court).

Three conditions must be satisfied to reopen a previous decision under the change of law exception for both law of the case and issue preclusion. First, the governing law must have been altered. See 18 Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 4425 (2d ed. 2002) (exception to issue preclusion only available as a result of “independent changes” in the law and not “merely because the defeated party wishes to reargue the law”); 18B Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 4478 (2d ed. 2002) (“The easiest cases [for departing from law of the case] occur when the law has been changed by a body with greater authority on the issue . . . .”).

Second, the decision sought to be reopened must have applied the old law. See, e.g., Litton, 238 F.3d at 1380 (holding that intervening law exception to law of

15a the case applied where previous opinion had followed approach expressly repudiated by intervening en banc decision); Rose Acre Farms, 559 F.3d at 1278 (inter-vening law exception applied where prior opinion had “clearly applied the [old] test”).

Third, the change in law must compel a different result under the facts of the particular case. See Hughes Aircraft Co. v. United States, 140 F.3d 1470, 1475 (Fed. Cir. 1998), overruled on other grounds by Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., 234 F.3d 558 (Fed. Cir. 2000) (rejecting argument that issue should be reopened because the “analysis performed in [the previous appeal] satisfies the . . . rule as stated in [an intervening Supreme Court decision]”); Hughes Aircraft Co. v. United States, 86 F.3d 1566, 1576 (Fed. Cir. 1996), cert. granted, judgment vacated on other grounds, 520 U.S. 1183 (1997) (holding that intervening law exception to law of the case did not apply where “analysis in the court’s prior decision is . . . entirely consistent” with interven-ing en banc decisions); Cal. Fed. Bank v. United States, 395 F.3d 1263, 1274–75 (Fed. Cir. 2005) (holding that intervening en banc decision did not warrant reopen-ing previous decision because principles of en banc decision did not apply on the facts of the case on appeal). Here, as the Supreme Court recognized in Nautilus, the Supreme Court’s new standard does not always lead to a different result. 134 S. Ct. at 2130–31 (remanding for consideration of whether claims were definite under the new standard).

Each of these requirements was satisfied here.

First, there can be no serious question that Nautilus changed the law of indefiniteness. This was indeed the very purpose of the Nautilus decision. Prior to Nautilus, we applied the following test:

16a [W]hat we have asked is that the claims be amenable to construction, however difficult that task may be. If a claim is insolubly ambiguous, and no narrowing construction can properly be adopted, we have held the claim indefinite. If the meaning of the claim is discernible, even though the task may be formidable and the conclusion may be one over which reasonable persons will disagree, we have held the claim sufficiently clear to avoid invalidity on indefiniteness grounds.

Exxon, 265 F.3d at 1375. In Nautilus, the Supreme Court expressly rejected that “insolubly ambiguous” or “amenable to construction” standard. Nautilus, 134 S. Ct. at 2124. Rather, the Court “h[e]ld that a patent is invalid for indefiniteness if its claims, read in light of the specification delineating the patent, and the pros-ecution history, fail to inform, with reasonable cer-tainty, those skilled in the art about the scope of the invention.” Id. The Court explained further: “[i]t cannot be sufficient that a court can ascribe some meaning to a patent’s claim; the definiteness inquiry trains on the understanding of a skilled artisan at the time of the patent application, not that of a court viewing matters post hoc.” Id. at 2130.

Nautilus emphasizes “the definiteness require-ment’s public-notice function.” 134 S. Ct. at 2130; see also id. at 2129 (“[A] patent must be precise enough to afford clear notice of what is claimed, thereby ‘appris[ing] the public of what is still open to them’” (quoting Markman v. Westview Instruments, Inc., 517 U.S. 370, 373 (1996)) (alterations in original)). Although the Court recognized that “[s]ome modicum of uncertainty” may be tolerated, id. at 2128, the patent and prosecution history must disclose a single known approach or establish that, where multiple

17a known approaches exist, a person having ordinary skill in the art would know which approach to select. See Teva, 789 F.3d at 1341, 1344–45 (holding claim indefinite where molecular weight could be measured three different ways and would yield different results and the patent and prosecution history did not provide guidance as to which measure to use). Particularly this is so where different approaches to measurement are involved. See id. at 1341, 1344–45. Thus, contrary to our earlier approach, under Nautilus, “[t]he claims, when read in light of the specification and the prosecution history, must provide objective boundaries for those of skill in the art.” Interval Licensing LLC v. AOL, Inc., 766 F.3d 1364, 1371 (Fed. Cir. 2014) (citing Nautilus, 134 S. Ct. at 2130 & n.8).

Second, there is also no question that our original decision applied pre-Nautilus law. Dow argues that our opinion in the previous appeal was not incon-sistent with Nautilus and that we did not apply the “amenable to construction” or “insolubly ambiguous standard.” But the fact that we did not include that particular language does not mean that we were not applying the prevailing legal standard. We cited Exxon, see Dow, 458 F. App’x at 917, which Nautilus specifically cited as exemplary of the rejected Federal Circuit standard. See Nautilus, 134 S. Ct. at 2130 n.9. Applying Exxon, we explained that a patent is definite under § 112 ¶ 2 if:

“one skilled in the art would understand the bounds of the claim when read in light of the specification.” A claim is not indefinite merely because it is difficult to construe. To be indefinite, a claim term must be such that “no narrowing construction can properly be adopted” to interpret the claim.

18a Dow, 458 F. App’x at 917 (quoting Exxon, 265 F.3d at 1375). We also explained that “the test for indefinite-ness is not whether the scope of the patent claims is easy to determine, but whether ‘the meaning of the claim is discernible, even though the task may be formidable and the conclusion may be one over which reasonable persons will disagree.’” Id. at 920 (quoting Exxon, 265 F.3d at 1375). This language corresponds exactly to the “amenable to construction” or “insolubly ambiguous” standard rejected in Nautilus.

Third, as we now discuss, our original decision would have been different under the new Nautilus standard.

II

The claim term at issue here provides for “a slope of strain hardening coefficient greater than or equal to 1.3.” ’053 patent col. 16 ll. 19–20; ’023 patent col. 16 ll. 29–30. The patents provide that the “slope of strain hardening coefficient” (“SHC”) is calculated according to the following equation:

SHC = (slope of strain hardening)*(I2)0.25

where I2=melt index in grams/10 minutes. ’053 patent col. 6 ll. 45–50; ’023 patent col. 7 ll. 22–28. “The SHC coefficient is a new Dow construct, not previously known in the art . . . .” Dow, 458 F. App’x at 918.

Strain hardening is a property wherein a material becomes harder as it is stretched. The ’053 and ’023 patents teach that tensile properties, including strain hardening, may be tested using a device called the Instron Tensile Tester. The Instron Tensile Tester subjects a sample to an increasing load, stretching it until it breaks. The machine measures the force, or

19a load, applied to the sample and the length that the sample stretches.

The measurements taken by the Instron Tensile Tester are then plotted on a graph. The resulting curve is called the “tensile curve” or “stress/strain curve.” On the stress/strain curve, the force (or load) applied to the sample is plotted on the y-axis, and the resulting elongation (or displacement) of the sample is plotted on the x-axis. The behavior of the material claimed by the patent changes as it is stretched, and those changes are shown on the stress/strain curve. A figure from the prior art utilized in Dow’s brief illustrates a typical stress/strain curve.

Appellee’s Br. 7; J.A. 10493.

There are three main phases of behavior, corre-sponding to regions I, III, and IV on the figure. At first, when an increasing force is applied to a sample of the compound claimed by the patent, the sample pulls its initial load and has little or no elongation. In other words, when an increasing force is initially applied,

20a the sample stretches very little, if at all. This is shown in region I in the figure above. Then, after the sample has been subjected to the initial load, it stretches a relatively large amount in response to little or no increase in force. The portion of the stress/strain curve showing these latter effects is called the “drawing region.” The drawing region has a lower, or relatively flat, slope because the force increases little (or not at all), while the elongation increases significantly. The drawing stage is shown as region III in the figure above.7

After the drawing stage, there is a third phase—the strain hardening region—which corresponds to region IV in the figure above. The strain hardening region is the focus of the claim term at issue here. In the strain hardening region, the material hardens, and it stretches much less in response to an increased force than in the drawing region. At first, in the strain hardening region, there is still some drawing effect. As the material continues to stretch, the strain hardening effect increases and the drawing effect decreases. When plotted, the strain hardening region is curved in most instances. Because the strain hardening region is typically curved, it does not have a single slope. Typically, the curve will get steeper as more force is applied.

NOVA argues that the term “slope of strain hardening coefficient,” ’053 patent col. 16 l. 19, is indefinite because the patent fails to teach with

7 Region II in the figure corresponds to a region where the force

decreases and is not relevant here.

21a reasonable certainty where and how the “slope of strain hardening” should be measured.8

Although the patents state that “FIG. 1 shows the various stages of the stress/strain curve used to calculate the slope of strain hardening,” ’053 patent col. 6 ll. 40–41; ’023 patent col. 7 ll. 18–19, the patents do not contain the FIG. 1 referenced in those passages. Nor do the patents include any other figure showing the stress/strain curve. The specification of the ’053 and ’023 patents teach that “[t]he slope of strain hardening is calculated from the resulting tensile curve by drawing a line parallel to the strain hardening region of the . . . stress/strain curve.” ’053 patent col. 6 ll. 27–29; ’023 patent col. 7 ll. 5–7.

At trial, Dow’s expert Dr. Hsiao testified that “one of ordinary skill in the art would know that the slope of the hardening curve would have to be measured at its maximum value, which reflects the best tensile perfor-mance of the material.” Dow, 458 F. App’x at 919. We may assume that, as Dr. Hsiao testified and as Dow repeatedly argues, it was known that the maximum slope should be measured.

But three methods existed to determine the maxi-mum slope, each providing, as Dow admits, “simply a different way of determining the maximum slope.” Appellee’s Br. 45 (emphasis added). Dow admitted that those three methods “all typically occur at the same place—at the end of the curve where the maximum slope is located.” Id. We refer to these

8 NOVA also argues that the claim is indefinite because it

failed to identify the units for the slope of strain hardening. In light of our disposition we need not reach this issue.

22a methods as the “10% secant tangent method,” “final slope method,” and “most linear method.”

The 10% secant tangent method is taught by a later Dow patent, U.S. Patent No. 6,723,398 (the “’398 patent”). Under the 10% secant tangent method, “[t]he slope of strain hardening is conveniently taken as the line representing a 10 percent secant tangent which is calculated from the failure point to the point at 10 percent extension before the failure point (where 10 percent extension before is equal to 90 percent of the total extension or strain).” ’398 patent col. 11 ll. 6–11. In other words, a line is drawn between two points, one at the failure point and one at 10% before the failure point. The slope of that line is then calculated. See id. FIG. 2. In the final slope method, the “slope of strain hardening [is] calculated from the slope of [a] tensile curve just prior to break.” J.A. 6662. In the most linear method, “[t]he slope of the strain hardening region (SSH) was measured by manually selecting two points in the most linear part of the [strain hardening] region” and dividing the change in force by the change in elongation. J.A. 6704. The constant slope region closely precedes the breaking point.

For purposes of this case, Dr. Hsiao developed yet another method—of his own invention—to calculate the slope of strain hardening. Dr. Hsiao’s testing produced curves with 1,500 data points representing the force applied to a sample and the sample’s elongation. He then analyzed subsets of fifty data points. For each set of fifty data points, Dr. Hsiao used a computer to apply a linear regression routine to fit a line to the fifty points and calculate a slope of the resulting line. He then selected the highest of those resulting slopes in order to find the maximum slope.

23a There is no question that each of these four methods

may produce different results, i.e., a different slope. Dr. Hsiao testified that the 10% secant tangent method, the final slope method, the most linear method, and the method he invented could produce different results. In comparison to the three other methods, Dr. Hsiao’s method would produce a higher value. Because the methods do not always produce the same results, the method chosen for calculating the slope of strain hardening could affect whether or not a given product infringes the claims.

Neither the patent claims nor the specification here discusses the four methods or provides any guidance as to which method should be used or even whether the possible universe of methods is limited to these four methods. Nor does either party argue that the prosecution history provides any guidance. Further, Dr. Hsiao did not testify that one of ordinary skill in the art would choose his method over the three known methods. Indeed, he was not even aware of the other methods at the time he did his analysis. He admitted that he applied only his judgment of what a person of ordinary skill would believe and did not interview anyone or cite any references discussing how a person at the time of the patent application would have calculated the slope of strain hardening.

The question is whether the existence of multiple methods leading to different results without guidance in the patent or the prosecution history as to which method should be used renders the claims indefinite. Before Nautilus, a claim was not indefinite if someone skilled in the art could arrive at a method and practice that method. Exxon, 265 F.3d at 1379. In our previous opinion, relying on this standard, we held that the claims were not indefinite, holding that “the mere fact

24a that the slope may be measured in more than one way does not make the claims of the patent invalid.” Dow, 458 F. App’x at 920. This was so because Dow’s expert Dr. Hsiao, a person skilled in the art, had developed a method for measuring maximum slope. See id. at 919–20.

Under Nautilus this is no longer sufficient. “[A] patent is invalid for indefiniteness if its claims, read in light of the specification delineating the patent, and the prosecution history, fail to inform, with reasonable certainty, those skilled in the art about the scope of the invention.” 134 S. Ct. at 2124; see also id. at 2129 (“[W]e read § 112, ¶ 2 to require that a patent’s claims, viewed in light of the specification and prosecution history, inform those skilled in the art about the scope of the invention with reasonable certainty.”). Here the required guidance is not provided by the claims, specification, and prosecution history.

In this respect this case is quite similar to our recent decision in Teva, decided under the Nautilus standard. In Teva,9 the claim limitation at issue recited the term “molecular weight.” 789 F.3d at 1338. But there were three relevant measures for molecular weight—peak average molecular weight (“Mp”), number average molecular weight (“Mn”), and weight average molecu-lar weight (“Mw”)—where each was calculated in a different manner and each typically had a different value. Id. We looked to “the patent record—the claims, specification, and prosecution history—to ascertain if they convey to one of skill in the art with reasonable certainty the scope of the invention claimed.” Id. at

9 This case was on remand from the Supreme Court, where the

Court held that subsidiary factual findings made by a district court in claim construction are reviewed for clear error. Teva Pharm. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831, 841 (2015).

25a 1341. Neither the claims nor the specification con-tained an explicit definition of molecular weight, id., and the prosecution history contained inconsistent statements, id. at 1342–1344. Therefore, the claims were indefinite under Nautilus. Id. at 1344–45. This was so even though the patentee’s expert—like Dr. Hsiao here—testified that someone skilled in the art could determine which method was the most appropriate. Id. at 1338, 1341.

The claims here are even more clearly indefinite than those in Teva. Here, Dr. Hsiao’s chosen method was not even an established method but rather one developed for this particular case. As we held in Interval Licensing, a claim term is indefinite if it “leave[s] the skilled artisan to consult the ‘unpredicta-ble vagaries of any one person’s opinion.’” 766 F.3d at 1374 (quoting Datamize, LLC v. Plumtree Software, Inc., 417 F.3d 1342, 1350 (Fed. Cir. 2005)).10 The claims here are invalid as indefinite, and the award of supplemental damages must be reversed. Under these circumstances, we need not address the cross-appeal as to enhanced damages.

APPEAL NO. 2014-1431 REVERSED APPEAL NO. 2014-1462

DISMISSED AS MOOT COSTS

Costs to NOVA.

10 This case is unlike Biosig Instruments, Inc. v. Nautilus, Inc.,

783 F.3d 1374, 1377 (Fed. Cir. 2015). In Biosig, we held that the prosecution history, the language of the claims, and the knowledge of one skilled in the art demonstrated that “a skilled artisan would understand the inherent parameters of the invention as provided in the intrinsic evidence” and that the claim term at issue “informs a skilled artisan with reasonable certainty of the scope of the claim.” Id. at 1382–84.

26a APPENDIX B

2014 WL 1285508 Only the Westlaw citation is currently available.

————

UNITED STATES DISTRICT COURT, D. DELAWARE

————

Civ. No. 05–737–LPS

————

THE DOW CHEMICAL COMPANY, Plaintiff,

v.

NOVA CHEMICALS CORPORATION (CANADA), AND NOVA CHEMICALS, INC. (DELAWARE),

Defendants. ————

Signed March 28, 2014 ————

Attorneys and Law Firms

Rodger D. Smith, II, Esq., MORRIS NICHOLS ARSHT & TUNNELL, LLP, Wilmington, DE, Harry J. Roper, Esq., Paul D. Margolis, Esq., Jamie Keating Lord, and Aaron A. Barlow, Esq., JENNER & BLOCK, LLP, Chicago, IL, Raymond N. Nimrod, Esq., and Joshua S. Reisberg, Esq., QUINN EMANUEL URQUHART OLIVER & HEDGES, LLP, New York, NY, Attorneys for Plaintiff The Dow Chemical Company.

David E. Moore, Esq., POTTER ANDERSON & CORROON, LLP, Wilmington, DE, Ford F. Farabow, Jr., Esq., Mark J. Feldstein, Esq., Sulay D. Jhaveri, Esq., Eric J. Fues, Esq., Ronald A. Bleeker., Esq., and Pier D. DeRoo, Esq., FINNEGAN HENDERSON FARABOW GARRETT

27a & DUNNER, LLP, Washington, DC, Attorneys for Defendants Nova Chemicals Corporation and Nova Chemicals, Inc.

OPINION

STARK, U.S. District Judge:

Pending before the Court is the issue of post-trial damages for the period of continued infringement from January 1, 2010 through October 15, 2011 (“Supple-mental Damages Period”) by Defendants, NOVA Chemicals Corporation (Canada) and NOVA Chemicals Inc. (Delaware) (together, “NOVA” or “Defendant”), of two of Plaintiff Dow Chemical Company’s (“Dow” or “Plaintiff”) patents. The Court held a two-day bench trial on this issue in April and May, 2013. Also pending is NOVA’s motion for stay of entry and execution of judgment. (D.I. 746) For the reasons explained below, the Court finds that Dow is entitled to lost profits and reasonable royalties for the Supplemental Damages period, but is not entitled to enhanced damages. The Court also denies NOVA’s motion for a stay of entry and execution of judgment.

BACKGROUND

A. The Parties, their Products, and the Patents

1. Plaintiff Dow is a chemicals company that manufactures plastics, including polyethylene (“PE”) products, which it then sells to customers who convert the PE product into items such as stretch film or shampoo bottles. (D.I. 749 at 3)

2. Plaintiff is the owner of the patents-in-suit: U.S. Patent Nos. 5,847,053 and 6,111,023. (D.I. 1) The patents-in-suit expired on October 15, 2011. (D.I. 731 at 2, ¶ 1)

28a 3. Dow manufactures and sells ELITE, a type of

plastic product that is both stronger and thinner than other types of plastic, and is also an embodiment of the patents-in-suit. (D.I. 573 at 114–15)

4. Defendant NOVA manufactures chemicals, including PE and other products. (D.I. 14 at 2)

5. NOVA manufactures and sells SURPASS, a PE product that competes directly with Dow’s ELITE. (D.I. 748 at 2; D.I. 573 at 179) NOVA also manufactures and sells XJS, an off-grade product that does not meet the target grade specifications, which has to be sold for a lower price. (D.I. 578 at 99)

B. The Jury Trial

6. Dow filed suit against NOVA for infringement of the patents-in-suit on October 21, 2005. (D.I. 1)

7. The Court held a jury trial in June 2010.

8. On June 15, 2010, the jury returned a verdict finding that NOVA’s SURPASS and XJS products infringed one or more claims of the patents-in-suit. (D.I. 526) The jury awarded Dow $61,770,994.60 in total damages: $57,447,024.98 for lost profits and $4,323,969.62 in reasonable royalties. These damages were for NOVA’s infringement of the patents-in-suit from March 2002 through December 31, 2009. (Id.)

9. The jury did not award Dow the full amount of damages it had sought. With respect to lost profits, Dow’s expert, Creighton Hoffman, opined that Dow would have captured 80% of NOVA’s sales, but the jury apparently applied only a 72% capture rate. (314–15, 377–78; see also 530, 536 (testimony of Dow expert

29a Chelton Tanger))1 As for a reasonable royalty, the jury rejected Dow’s proposed rate of 10% and instead applied an effective royalty rate of 1.755%. (346)

C. Post–Trial Proceedings

10. On July 30, 2010, the Court denied NOVA’s motions for judgment as a matter of law and a new trial related to the jury’s lost profits award. (D.I. 609) Generally, the Court concluded that “the jury was entitled to credit Mr. Hoffman’s testimony” and, in particular, that “Mr. Hoffman’s testimony and the related evidence on lost profits [supported] the jury’s lost profits award.” (Id. at 9) The Court further concluded that the evidence presented at the 2010 trial sufficiently established the absence of non-infringing alternatives that were acceptable to NOVA’s customers who purchased NOVA’s infringing SURPASS products. (Id.)

11. Also on July 30, 2010, the Court denied Dow’s motion for a permanent injunction (D.I. 556), thereby permitting NOVA to continue to sell SURPASS and XJS products (D.I. 603). Among other things, the Court found that there were “substantial issues for appeal” and that NOVA customers would be injured by an injunction. (Id. at 2–3) After the denial of the per-manent injunction, NOVA adopted and implemented a remedial policy not to sell the infringing SURPASS products to new accounts. (414)

1 All citations refer to the transcript from trial on supplemental

damages held on April 30 (D.I. 743) and May 1, 2013 (D.I. 744), unless indicated otherwise (e.g., D.I. 746). The Court’s citations to the trial transcript are intended to refer both to the testimony itself as well as any admitted exhibits discussed by the witness in that portion of the transcript.

30a 12. NOVA filed an appeal. (D.I. 614, D.I. 617) On

December 22, 2010, the Court stayed proceedings in this Court during the pendency of the appeal. (D.I. 634) On April 4, 2012, the Federal Circuit affirmed the judgment for Dow in all respects. (D.I. 637, D.I. 638) On June 7, 2012, the Court lifted its stay. (D.I. 652)

13. On August 20, 2012, the Court granted NOVA’s motion for summary judgment of no willful infringe-ment. (D.I. 674)

14. On October 29, 2012, the Supreme Court denied NOVA’s petition for a writ of certiorari. See Nova Chemicals Corp. v. Dow Chem. Co., 133 S.Ct. 544 (2012).

D. Bench Trial

15. As the parties were unable to agree on the amount of supplemental damages to which Dow is entitled, the Court scheduled a bench trial. (D.I. 652, D.I. 711)

16. At the pretrial conference on April 12, 2013, the Court, among other things, denied NOVA’s motion to stay the damages proceeding or, in the alternative, stay entry and execution of judgment during the pendency of ongoing reexamination proceedings of the patents-in-suit by the U.S. Patent and Trademark Office (“PTO”). (D.I. 727, D.I. 741, D.I. 759) The Court’s denial was without prejudice to renew the stay request with respect to entry and execution of the judgment in connection with briefing that would follow the bench trial on damages. (D.I. 741)

17. The Court held a bench trial on supplemental damages on April 30 and May 1, 2013. The parties completed post-trial briefing on July 18, 2013. (D.I. 747–751, D.I. 754)

31a 18. NOVA renewed its motion for a stay on June 3,

2013. (D.I. 746) After briefing was completed on NOVA’s motion on July 18, 2013 (D.I. 747, D.I. 752), the parties advised the Court of subsequent develop-ments on October 24, 2013, November 6, 2013, and February 12, 2014 (D.I. 755, D.I. 756, D.I. 758), including the PTO’s issuance of Office Actions rejecting all claims of both patents-in-suit (D.I. 755).

FINDINGS OF FACT 2

A. Dow’s Polyethylene Products and Manufact-uring Processes

1. Dow sells a variety of polyethylene (“PE”) products into the marketplace through direct transactions with customers and through distribution channels. (67–68) The direct customers, called converters, receive PE product from Dow and then convert the PE product into rigid items such as shampoo bottles, or flexible film items such as stretch film. (68–69)

2. Dow’s PE products include high-density PE, also known as HDPE, and linear low density PE, also called LLDPE. (68–69) HDPE is used to manufacture rigid types of product such as buckets, pales, milk bottles, shampoo bottles, and butter tubs. (Id.) Because of the product’s low density, LLDPE can be

2 Each of the Court’s findings of fact, in this section and

throughout this Opinion, are based on the Court’s assessments of what was demonstrated by a preponderance of the credible evidence, including the testimony of witnesses. See Fed. R. Civ. Proc. 52(a); Minco, Inc. v. Combustion Engineering, Inc., 95 F.3d 1109, 1118 (Fed.Cir. 1996) (“The patent holder bears the burden of proving the amount of the award . . . by a preponderance of the evidence.”).

32a used in a variety of flexible film products like trash bags, stretch wrap, and meat wrap. (Id.)

3. Dow’s patented products are LLDPE products sold by Dow under the brand name ELITE. Dow considers ELITE to be one of its premium products. (69) ELITE falls under a subclass of LLDPE products referred to as mLLDPE, whereby “m” refers to the metallocene catalyst used in the production of ELITE, which causes the polymer to have different properties than the type of polymers made with other catalysts. (130) ELITE is sold into the Industrial and Consumer Packaging Market and the Food and Specialty Packaging Market. (130–31) ELITE is used in a variety of product applications, including stretch film and heavy-duty shipping sacks. (69–71, 131–32)

B. Polyethylene Qualification and the Value of Incumbency

4. It is valuable for a supplier of PE, such as Dow or NOVA, to be the incumbent supplier of PE products to converters or customers because converters and customers tend to stay with their incumbent supplier to avoid having to qualify an alternative resin. (143–44) Former Dow marketing director Mr. Christopher Paul Thomson testified, “incumbency is a very powerful position, something we worked very hard to get, and we worked very hard . . . to maintain that position.” (143)

5. Qualifying a PE resin is a demanding, time-consuming process in which suppliers work with converters to ensure that particular PE products are engineered to work with the converters’ manufactur-ing equipment and deliver the properties required by the converters and the converters’ customers. (144–47) NOVA’s Quality Leader, Dr. Paul Tas, explained that

33a the qualification process consists of eight steps: an initial qualification trial, a scale-up trial, testing of the film product manufactured by the converter, evaluating the results of such testing, evaluation by the converter’s customers (the end users), a second scale-up trial, potential negotiations over product specifications, and then full acceptance. (189–95) Each trial alone takes three to fourth months. (192–95) Moreover, according to Dr. Tas, full acceptance can be delayed by “[a]nother three, fourth months” if the customer wants to negotiate the product specification after the scale-up trials. (195) Hence, the process for qualifying an alternative resin at a customer typically takes as long as 18 months. (195)

C. The Market for Dow’s ELITE Products in the Supplemental Damages Period

6. In the Supplemental Damages Period, ELITE was Dow’s premium linear low-density film product. (129) This was also true during the period prior to 2010. (130) Dow positioned ELITE in the marketplace as having a superior overall balance of excellent physical properties and processability as compared to other products. (131) In 2010–2011, Dow targeted its ELITE product to the same customers that it had targeted in the period considered by the jury, 2002 to 2009—that is, customers that valued processability and superior physical properties. (131)

7. In the Supplemental Damages Period, Dow’s pr-imary competitor for the ELITE film grades was NOVA’s SURPASS. (132, 156) This was also true during the period prior to 2010 considered by the jury. (156) According to Mr. Thomson, NOVA’s SURPASS and Dow’s ELITE products were the most comparable products on the market in terms of processability and

34a balance of physical properties at all pertinent times. (161)

8. In the Supplemental Damages Period, there were PE product offerings in the mLLDPE space other than ELITE and SURPASS. Those products included Exxon’s EXCEED, LyondellBasell’s STARFLEX, ChevronPhillip’s MPACT/MARFLEX, and Westlake’s MXSTEN. (156–57) Of all the products sold in the mLLDPE space during the Supplemental Damages Period, only SURPASS and ELITE were made using a dual-reactor, solution process; only ELITE and SURPASS could offer the benefits of the patented invention: the overall balance of excellent physical properties and excellent processability. (157–58, 313; PDEM_SD2205)

9. According to Mr. Thomson, the competitive dynamics between EXCEED, STARFLEX, MPACT and MXSTEN on the one hand, and ELITE and SURPASS on the other, did not change in the 2010–2011 time frame as compared to the 2002 to 2009 period considered by the jury. (159, 160–61) Thomson also testified that what customers found acceptable in the mLLDPE market did not change in 2010 and 2011 as compared with 2009. (161)

D. Dow’s Strategy for Selling Polyethylene Products

10. Dow refers to its solution PE sales strategy as “Selling Out and Selling Up,” which has been implemented into Dow’s business strategy including at the sales and production levels since at least the early 2000s. (137–38)

11. “Selling out” refers to Dow’s strategy of selling out its manufacturing capacity to fully utilize its reactors. (207–08)

35a 12. Dow also focuses on “selling up”—that is, selling

as much of its high value, high margin products as possible. (83–85; PTX 2035 at 19) As Dow strives to first “sell up” higher margin products like ELITE, it necessarily reduces sales of lower margin products like commodity-grade HDPE that is being displaced by the resources (such as manufacturing capacity) it invests in production of higher margin products. (83–86) Dow’s commodity grade HDPE products, which Dow refers to as non-strategic products, are sold primarily on a transaction-by-transaction basis; that is, they are not generally subject to a long-term supply agreements. (102, 209)

E. Dow’s Strategy for Manufacturing Additional ELITE

13. Dow’s eight solution polyethylene trains have the capacity to produce over three billion pounds of polyethylene each year and over one billion pounds of ELITE each year. (77, 202–03, 234–35; PDEM_ SD2106) Historically, Dow has made only about 500 million pounds of ELITE annually. (79, 235–37; PDEM_SD2304; PTX2042) Dow’s ELITE-capable trains were fully utilized in 2010 and nearly folly utilized in 2011, but only about half of Dow’s capacity on those trains was used to manufacture ELITE in those years; the remaining capacity was used to manufacture DOWLEX 3 and HDPE. (235–37; PDEM_SD2305; PTX2042) Thus, Dow had the ability to produce another 500 million pounds of additional

3 DOWLEX is another premium LLDPE that has different

properties than ELITE (which is classified as an mLLDPE). (D.I. 749 at 3) Production of DOWLEX does not require an ELITE-capable (or dual-reactor) train. (D.I. 748 at 15)

36a ELITE per year during the Supplemental Damages Period. (237)

14. Dow engages in an annual production planning session to determine what volumes of high value, high margin products like ELITE Dow can expect to sell in the following year. This planning session is completed at an annual, fourth-quarter meeting at which sales managers discuss realized sales and project ELITE’S increased sales for the next year. (99–100, 204–05) Dow focuses on its current year’s sales, and uses its yearly historical sales figures as a starting point to determine its projected ELITE production for the upcoming year, and then adjusts its projections to take into account the fact that Dow has experienced consistent year-over-year growth of ELITE since the product was launched. (Id.; PTX2515)

15. Dow’s strategy is to load its solution reactors with high value, high margin products like ELITE and high margin DOWLEX, and then load any remaining capacity with lower margin, commodity-grade, non-strategic products like HDPE (as long as it would be profitable to do so). (209)

16. Dow could have manufactured additional ELITE products on its North American assets in 2010 and 2011. (216, 238) As explained by Mr. Jose Obregon, Dow’s Global Business Director for Solution-and Gas–Phase PE, Dow could have accomplished this by planning differently. (238–39, 244) If Dow had been selling more ELITE in 2009, Dow would have planned to produce and sell more ELITE in 2010, and would have planned to contract for more raw materials to allow it to manufacture the additional volume Dow planned to sell. (205–06, 239, 241–43) As a result, Dow would have planned to produce and sell less of its

37a low margin, commodity-grade, non-strategic HDPE products. (238–39, 244)

17. Dow could have met additional demand by allocating more of its capacity to its high value ELITE products, and less of its capacity to non-strategic, commodity-grade products like HDPE, consistent with the strategies discussed above. (216)

18. Dow has historically been able to procure the necessary volume of octene to meet the growth in demand for its ELITE products. (218–19) If Dow needed to manufacture an additional 100 million pounds of ELITE in the Supplemental Damages Period, Dow would have needed to purchase an additional 4.5 kilotons of octene. (221) Given that Dow purchases about 350 kilotons of octene annually, Dow could have and would have procured an additional 4.5 kilotons if needed to meet demand for ELITE, including by maintaining (rather than reducing) its contract levels for octene in 2009. (289–90)

F. Computation of Damages

19. At the jury trial in 2010, the jury awarded Dow $61,770,994.60 in total damages: specifically, $57,447,024.98 in lost profits and $4,323,969.62 in reasonable royalties. (303; PDEM_SD2402; D.I. 526) This was equal to more than 90% of the lost profits and 17.5% of the reasonable royalties Dow requested. (303; PDEM_SD2402) These damages were for NOVA’s infringement of the patents-in-suit from March 2002 through 2009. (303)

20. The jury’s lost profits award of $57,447,024.98 was 17.07% of NOVA’s infringing sales of SURPASS in the 2002 to 2009 period of $336,505,027. (PTX556 at Supp. Ex. C–4; 534) If one applies this effective rate

38a of 17.07% to the approximately $173 million in infring-ing SURPASS sales during the Supplemental Damages Period (see PTX2572 at Revised Updated Suppl. Ex. D–9), the damages NOVA would owe Dow would be $29.5 million for SURPASS, plus damages for XJS sales.

21. Dow’s expert Mr. Hoffman determined the amount of supplemental damages resulting from NOVA’s continued infringement during the Supplemental Damages Period to be $30,962,780. (303–06, 345; PDEM_SD2404; PDEM_SD2437; PTX2572 at Revised Updated Suppl. Exs. I & J) Mr. Hoffman calculated damages separately for the period from January 1, 2010 until July 30, 2010 (the date judgment was entered), and the period from July 31, 2010 until October 15, 2011 (the date the patents expired). (305) Damages during the former period, adjusted for the jury award, totaled $7,621,670, while damages for the latter period totaled $23,341,110, which was not adjusted for the jury award. (Id.) Mr. Hoffman applied the jury’s implicit royalty rate of 1.755% for the period January 1, 2010 through July 30, 2010, and applied a 10% royalty rate for the period July 31, 2010 to October 15, 2011. (305–06; PDEM_SD2405)

22. Mr. Hoffman’s methodology for calculating Dow’s damages in the Supplemental Damages Period was virtually the same as the methodology he had used at the 2010 jury trial. (303–04) Mr. Hoffman made certain adjustments to his calculation for the Supplemental Damages Period that were not necessary for his calculation of damages for the 2002 to 2009 period. For instance, for the Supplemental Damages Period, he deducted Dow’s profits on sales of HDPE that Dow would have foregone to make

39a additional ELITE. (Id.; PDEM_SD2403) This deduct-ion was not necessary to calculate Dow’s lost profits during the 2002–2009 period because, unlike during most of the Supplemental Damages Period, Dow had substantial empty plant capacity between 2002 and 2009. (303)

23. The jury’s award to Dow of substantial lost profits damages indicates that the jury determined that Dow would have been the incumbent supplier for the bulk of NOVA’s infringing sales in the 2002–2009 time period. (316–17) Mr. Hoffman concluded from the evidence presented that Dow would have, in the Sup-plemental Damages Period, maintained the business the jury determined Dow would have captured in the 2002–2009 period but for NOVA’s infringement. The evidence established that there were no relevant material changes in NOVA’s SURPASS customers or competitive dynamics in the Supplemental Damages Period from what had existed in the 2002 to 2009 period considered by the jury. (317–318; PDEM_ SD2413; PTX2572 at Revised Updated Supplemental Exhibit L–1; 539)

24. Mr. Hoffman assessed Dow’s supplemental lost profits by examining the Panduit factors: demand for the patented product; absence of acceptable, non-infringing alternatives; manufacturing capacity; and calculation of lost profits. (308–10)

a. As in the 2002 to 2009 period, demand continued to exist in the Supplemental Damages Period for the patented product. NOVA’s sales of the infringing SURPASS product reached record levels in the Supplemental Damages Period. (310; PDEMSD2408; PTX2572 at Revised Updated Suppl. Exs. H & D–7) In this latter period, NOVA sold about 246 million pounds of infringing

40a SURPASS, and generated about $173 million in sales. (PTX2572 at Revised Updated Suppl. Ex. H; PDEM_SD2408)

b. As in the 2002 to 2009 period, there were no non-infringing alternatives in the Supplemental Damages Period that were acceptable to those customers who purchased the infringing SURPASS products. (341–42) No new relevant products came onto the market during the Supplemental Damages Period. (Id.) There were no products on the market, other than SURPASS, that offered the same overall balance of excellent physical properties and processability as the patented ELITE products. (See id.) While NOVA’s sales director testified that a trend existed to utilize multilayer structures in film products, allowing products with inferior processability (such as Exxon’s EXCEED) to become more acceptable (410–11), this trend started in the 1990’s and grew exponentially in the early 2000s—the exact time frame considered by the jury at the first trial. (299, 416–19) This “trend” is not a change that differentiates the Supplemental Damages Period from the 2002–2009 period.

c. As in the 2002 to 2009 period, Dow had adequate manufacturing capacity, including the capability to manufacture about 500 million pounds of additional ELITE annually, in the Supplemental Damages Period. (238)

d. As in the 2002 to 2009 period, Mr. Hoffman calculated Dow’s lost profits for the Supplemental Damages Period to a reasonable degree of certainty, the only difference being that in the Supplemental Damages calculation he deducted the profit on HDPE that Dow would not have

41a made in the “but for” world in order to make more ELITE. (326–27) Just as he did during the first trial, Mr. Hoffman calculated Dow’s ELITE component costs based on Dow’s quarterly standard cost sheets that Dow prepares in the normal course of business, which are referred to as product cost estimates (“PCEs”), and which are updated every quarter. (335–36) NOVA’s expert, Mr. Tanger, also relied on Dow’s PCEs at the first trial, as well as in his first expert report relating to the Supplemental Damages Period. (Id.; 549)

25. Dow seeks a reasonable royalty of $3,008,453 on NOVA’s sales of infringing SURPASS not subject to lost profits, and infringing XJS sales during the Supplemental Damages Period based on a rate of at least 10%. (D.I. 749 ¶ 74 (citing 345; PDEM_SD2436; PTX2572 at Revised Updated Suppl. Exs. I–3, I–4, J–3, & J–4) By contrast, NOVA insists that Dow is entitled only to the reasonable royalty rate of 1.755%, consistent with the jury’s 2010 verdict. (D.I. 751 ¶ 77)

DISCUSSION

I. Dow’s Request for Supplemental Damages

A. Legal Standards

The Court’s power to award damages not found by a jury is based on statute. See 35 U.S.C. § 284 (“When the damages are not found by a jury, the court shall assess them.”). The statute gives no guidance for awarding damages, so the Court must use its discretion in the matter. See Grain Processing Corp. v. American Maize–Products Co., 185 F.3d 1341, 1349 (Fed.Cir. 1999) (“The district court must exercise sound discretion to determine the amount of damages, based upon its underlying factual findings and legal

42a conclusions”); Devex Corp. v. Gen. Motors Corp., 667 F.2d 347, 357 (3d Cir. 1981) (“[T]he awarding of damages involves a subtle judicial function; the statute allows considerable latitude (to the fact-finding court).”).

To recover damages based on lost profits, the patent owner has the burden to show a reasonable probability that “but for” the infringement, it would have made additional sales of and additional profits on the patented product. See Grain Processing, 185 F.3d at 1349; Wechsler v. Macke Intern. Trade, Inc., 486 F.3d 1286, 1293 (Fed.Cir. 2007). In awarding damages, the Court must rely on hypothetical economic projections. “The ‘but for’ inquiry therefore requires a reconstruc-tion of the market, as it would have developed absent the infringement” to determine the amount of lost profits. Grain Processing, 185 F.3d at 1350.

Courts tasked with defining the parameters of the “but for” world of lost profits have articulated four elements the patent owner must prove to recover. “[T]he patent owner must prove (1) a demand for the patented product, (2) an absence of acceptable noninfringing substitutes, (3) the manufacturing and marketing capability to exploit the demand, and (4) the amount of profit the patent owner would have made.” Siemens Medical Solutions USA, Inc. v. Saint–Gobain Ceramics & Plastics, Inc., 637 F.3d 1269, 1287 (Fed.Cir. 2011) (citing Panduit Corp. v. Stahlin Bros. Fibre Works, Inc., 575 F.2d 1152, 1156 (6th Cir. 1978)). After the patent owner establishes a reasonable probability of “but for” causation, the burden shifts to the infringer to show that this conclusion is unreasonable. See Grain Processing, 185 F.3d at 1349.

43a B. Dow Proved It Should Receive Lost Profits

for the Supplemental Damages Period

In the 2010 infringement trial, the jury found that Dow proved the Panduit factors for lost profits recovery. The Court finds each of these elements were also proven by a preponderance of the evidence for the Supplemental Damages period.

1. Continued demand for the patented product

Both Dow and NOVA continued to sell their ELITE and SURPASS products during the Supplemental Damages period. NOVA does not contend that Dow failed to prove continued demand for the patented product.

2. Absence of acceptable non-infringing alternatives

To prove that there are no acceptable noninfringing alternatives, the patent owner “must show either that (1) the purchasers in the marketplace generally were willing to buy the patented product for its advantages, or (2) the specific purchasers of the infringing product purchased on that basis.” Standard Havens Prods. v. Gencor Indus., Inc., 953 F.2d 1360, 1373 (Fed.Cir. 1991). It follows that “if purchasers are motivated to purchase because of particular features available only from the patented product, products without such features—even if otherwise competing in the marketplace—would not be acceptable noninfringing substitutes.” Id.

NOVA argues that the market for polyethylene was changing after 2009: customers were finding products “acceptable” that may not have been considered acceptable before (517–21); processability, the main

44a selling point for the ELITE and SURPASS products, was becoming less important to customers (441–42); and competition was increasing in the market for multi-layer resins (170–71). However, the evidence shows that while these trends did exist in the Supplemental Damages Period, they likewise existed in the 2002 to 2009 period considered by the jury, and indeed began in the 1990s. (299, 416) Moreover, qualifying polyethylene products is a time-consuming and demanding process, often taking as long as eighteen months, which prevents customers from easily moving their business among competitors. (195) The Court finds no material changes in the market for acceptable alternatives took place between the time of the jury trial and the time now under consideration (until October 15, 2011). NOVA failed to show that any new products had been introduced into the market during the Supplemental Damages period which would qualify as non-infringing alternatives.

3. Marketing and manufacturing capabi-lity to meet demand

NOVA argues that Dow had no manufacturing capacity during the Supplemental Damages Period, and since there was no excess ELITE capacity there could be no lost profits. While Dow’s manufacturing trains were fully utilized during the Supplemental Damages Period (349–52), Dow was producing HDPE, a lower-grade product than ELITE, and a product having a lower profit-margin (141, 209). The Court is persuaded that, but for NOVA’s infringement, Dow could have and would have been utilizing its produc-tion facilities to the full extent necessary for manufacturing ELITE instead of HDPE.

45a The evidence at trial showed that Dow’s business

model, throughout the 2000s and through the Supple-mental Damages Period, was to optimize production of high profit-margin products like ELITE over other, less profitable products. (235–37) HDPE was just one example of a less profitable product, which Dow used as a capacity filler to prevent production trains from sitting idle.4 (Id.) Given the opportunity, Dow showed it would “sell up” its plants by decreasing sales of HDPE and other non-strategic products while increas-ing sales of high margin products like ELITE. (141)

Dow had the capability to forgo its HDPE manu-facturing and prioritize its production of ELITE, which would result in higher profits for the company. Unlike ELITE, which was sold as part of a long-term contract agreement (94–96, 102), Dow sold HDPE on a transaction-by-transaction basis (102, 209). The Court found persuasive the testimony presented by Dow outlining its business practice of displacing HDPE production to free up capacity for ELITE or other high profit-margin products. (141) Under this “waterfall” production system, HDPE manufacturing would be moved to facilities with a one-reactor production train, while the two-reactor facilities which are necessary for ELITE production (at The Fort and Plaquemine) would be freed up to produce ELITE products. (75–76, 80–81)

The Court further agrees with Dow that but for NOVA’s infringement, Dow would have begun the Supplemental Damages Period in the position of incumbent supplier (for the NOVA sales it would have

4 Dow’s expert accounted for the profits from sales of HDPE during the Supplemental Damages period as filler to keep the production lines at full capacity, and deducted those sales from his lost profits calculation. (303–04)

46a captured). Dow would have planned for, and produced, the additional ELITE products. (99–100, 204–05) Furthermore, the Court is unconvinced by NOVA that Dow would have been defeated by a shortage of octene and finds that Dow had access to the octene necessary to fulfill the demand for ELITE in the but for scenario.

4. Amount of profit the patent owner would have made

Dow has proven its lost profits by multiplying NOVA’s total volume of SURPASS sold by the capture rate of sales by the profit margin per pound on ELITE. While NOVA contests Dow’s estimates on both the capture rate and the profit margin, the Court finds that Dow met its burden to prove lost profits under the Panduit factors, subject to the limitations described below.

a. Capture Rate

As part of its lost profits calculations, Dow asserts that but for NOVA’s infringement, Dow would have captured 80% of the SURPASS sales (in other words, that 80% of NOVA’s sales would have instead been sales of Dow’s ELITE products). Dow presented the same 80% estimate to the jury at the 2010 trial, but the jury reduced Dow’s requested damages award, implying a capture rate of no lower than 72%.5 (314–16) As the Court is persuaded that the record warrants essentially extending the jury’s award to cover the Supplemental Damages Period, the Court deems it most appropriate to use the 72% capture rate, rather than Dow’s requested 80% capture rate. The

5 The jury award was approximately 90% of Dow’s requested

lost profits amount, and approximately 17% of its requested royalties amount. (305)

47a remaining 28% of infringing SURPASS sales will be subject to a reasonable royalty, as discussed below.

NOVA argues that the jury award fully compensates Dow for any injury, including lost customer relation-ships, and so there would be no captured sales in the “but for” world during the Supplemental Damages period. (D.I. 750 at 5) NOVA’s theory is that the jury award essentially acts to license all infringing sales from 2002 to 2009, and so NOVA rightfully became the incumbent for these sales at the start of the Supplemental Damages Period. (Id. at 6) The Court disagrees. See Grain Processing Corp. v. Am. Maize–Prods. Co., 185 F.3d 1341, 1350 (Fed. Cir. 1999) (stating that but for inquiry “requires a reconstruction of the market as it would have developed absent the infringing product, to determine what the patentee would . . . have made”). NOVA’s approach would give it, an adjudicated infringer, a benefit of substantially reduced damages solely due to the happenstance that the jury trial took place during, and not after, infringement. (See generally D.I. 754 at 2) The Court will not exercise its discretion in NOVA’s favor on this basis.

b. Profit Margin

Dow estimates an incremental profit per pound of $0.37 (329; PDEM_SD2427), while NOVA contends these estimates understate ELITE costs by 4–10 cents per pound (“cpp”) and overstate Dow’s profit margin (D.I. 750 at 25). NOVA’s contention is based on its reliance on Dow’s Profit and Loss Statements’ “Standard Cost—Trade” line item, while Dow’s estimates are based on ELITE component costs from Dow’s quarterly standard cost sheets, referred to as product cost estimates (“PCEs”). (D.I. 750 at 24) During the jury trial, Dow’s expert used the PCE

48a estimates and the same methodology (335–37)—as did, notably, NOVA’s expert (549). Dow contends that the “Standard Cost—Trade” estimates include fixed costs, which result in a $0.04 to $0.07 increase in cost per pound over the PCEs. NOVA contends, by contrast, that PCEs are only estimates and that the calculation of lost profits should be based on actual cost. (371–72)

The Court sides with Dow on this dispute. Accord-ingly, the Court will apply Dow’s proposed profit margin, $0.37 cents per pound. (329; PDEMSD2427) 6

5. Reasonable royalties

The Court has discretion in determining a rea-sonable royalty based on all the evidence and facts presented, including the results of a hypothetical negotiation between the patent owner and the infringer, at the appropriate time. See Georgia–Pacific Corp. v. U.S. Plywood Corp., 318 F.Supp. 1116, 1120 (S.D.N.Y. 1970). “The primary inquiry, often compli-cated by secondary ones, is what the parties would have agreed upon, if both were reasonably trying to

6 The Court has considered all of NOVA’s arguments, even

those not explicitly discussed in this Opinion. For instance, the Court evaluated each of the specific criticisms NOVA and its expert leveled on Dr. Hoffman’s analysis, but finds these criticisms individually and collectively—do not render Hoffman’s analysis unreliable. Additionally, the Court overrules NOVA’s renewed objections to certain portions of Hoffman’s testimony at trial as being beyond the scope of Hoffman’s pretrial disclosures, as the Court agrees with Dow that none of the challenged testimony on which Dow seeks to rely was anything other than a reasonable elaboration on the opinions Hoffman disclosed prior to trial, particularly as they are generally responses to criticisms from NOVA’s expert to which Hoffman had no prior opportunity to respond. (See D.I. 754 at 9, 15)

49a reach an agreement. . . . It requires consideration not only of the amount that a willing licensee would have paid for the patent license but also of the amount that a willing licensor would have accepted.” Id. at 1121.

Both parties agree that the royalty rate of 1.755% awarded by the jury should be applied to the period up through July 30, 2010, the date on which the Court denied Dow’s request for a permanent injunction to halt further sales of NOVA’s SURPASS. The parties disagree as to the appropriate royalty rate for the remainder of the Supplemental Damages Period. NOVA asserts that the jury’s 1.755% royalty rate should apply for the entire Supplemental Damages period. (D.I. 750 at 34) Dow contends, instead, that the 1.755% should be increased nearly six-fold to a 10% royalty rate. (D.I. 748 at 26) The Court is not persuaded to adopt either proposed royalty rate.

In exercising its discretion based on the particular facts proven here, the Court concludes that an appropriate royalty rate for the period of July 31, 2010 through October 15, 2011 is 2.11%, which is a 20% increase over the jury’s rate of 1.755%. The Court reaches this conclusion based primarily on the evidence that no material changes took place between the 2002 to 2009 period and the Supplemental Damages Period other than NOVA changed from being an alleged infringer to being an adjudicated infringer, a factor that would have reduced NOVA’s relative bargaining power in the hypothetical negotia-tions after trial. The Court has also factored in that former Judge Joseph J. Farnan, Jr., who presided over the 2010 jury trial, denied Dow’s motion for a permanent injunction.

50a C. Damages for Infringing Sales of XJS

In addition to reasonable royalties from NOVA’s sales of infringing SURPASS products, Dow is entitled to reasonable royalties on the sales of infringing XJS products. During the Supplemental Damages period, NOVA sold approximately 12.5 million pounds of infringing XJS products. (PTX2572 at D–10) Dow requests $68,212 for the period prior to July 30, 2010, which is adjusted to reflect the jury’s award (at a rate of 1.755%). (D.I. 748 at 25; PDEM_SD2437) On the remaining sales during the Supplemental Damages period, the Court applies the same 2.11% royalty rate as above. Since NOVA had a net revenue of $3,715,761 on XJS resins between July 30, 2010 and October 15, 2011 (PTX2572 at D–10), the additional royalties for this period are $78,403. Therefore, the total amount of royalties for the infringing XJS sales between January 1, 2010 and October 15, 2011 is $146,615.

D. The Court Will Not Award Enhanced Damages

Dow requests enhanced damages for NOVA’s willful post-judgment infringement during the sixteen months between when the Court denied Dow’s request for a permanent injunction and the expiration of the patents-in-suit. Dow argues that the Court may enhance a supplemental damages award upon a finding that the adjudicated infringer’s continued infringement in the face of an adverse jury verdict and judgment was willful. The Court, however, agrees with NOVA that the grant of NOVA’s motion for summary judgment of no willfulness effectively decided this issue in NOVA’s favor. (D.I. 674)

The Court is not persuaded it should revisit the question. Dow’s reliance on SynQor, Inc. v. Artesyn

51a Techs., Inc., 709 F.3d 1365 (Fed.Cir. 2013), is unavailing. SynQor shows that a Court may award enhanced damages even in the absence of a prior finding of willful infringement. Here, rather than no finding at all regarding willfulness, there is a finding of no willful infringement.

E. Interest

The parties appear to be in agreement that Dow is entitled to prejudgment interest, at the prime rate compounded quarterly, for the Supplemental Damages Period, with the exception of December 11, 2012 through April 13, 2013 (due to the Court’s continuance of trial at Dow’s request). (D.I. 711 at 3; D.I. 748 at 30) The parties appear to further agree that Dow is entitled to postjudgment interest as authorized by 28 U.S.C. § 1961. (D.I. 748 at 30; DI 750 at 2)

II. NOVA’s Motion for Stay of Entry and Execution of Judgment

NOVA requests the Court stay entry of judgment, or at least stay execution of judgment, until after completion of the ongoing reexaminations of the patents-in-suit. NOVA argues that it risks substantial and irreparable harm by paying the supplemental damages being awarded by the Court, as the PTO may eventually invalidate the patents-in-suit. NOVA has already paid the damages awarded by the jury in the 2010 trial and does not contend that it would be permitted to recover that payment even if the PTO invalidates the patents-in-suit.

Rather, NOVA distinguishes the supplemental dam-ages, on the grounds that there is a fundamental distinction between an executed judgment and an as-yet unexecuted judgment. NOVA further argues that,

52a at a minimum, the Court should require NOVA to place funds in escrow sufficient to pay the amount of supplemental damages being awarded, which would purportedly not cause any prejudice to Dow.

NOVA’s arguments implicate potentially difficult questions. If the patents-in-suit are invalid, NOVA cannot infringe them, and should not have to pay Dow anything further. But as of today the patents-in-suit remain valid, and they will be so until at least after any PTO proceedings are completed and any appeal to the Federal Circuit is completed (or the time for such appeal expires without any appeal being filed). Additionally, and weighing heavily against granting the requested stay, NOVA waited until very late in this litigation to initiate the reexaminations and to seek a stay. NOVA filed its petitions for reexamination of the patents-in-suit on December 17, 2012, more than seven years after this case was filed and more than two years after the jury’s verdict on infringement and invalidity. Under the circumstances, the Court believes the most appropriate exercise of its discretion is to deny the requested stay.

The Court has discretion to stay litigation pending reexamination. See Smarter Agent, LLC v. Mobilerealtyapps.com, LLC, 889 F.Supp.2d 673, 674 (D.Del. 2012) (citing Ethicon, Inc. v. Quigg, 849 F.2d 1422, 1426–27 (Fed.Cir. 1988)). In considering a stay request, the Court must weigh the competing interests of the parties by considering: “(1) whether a stay will simplify the issues and trial of the case, (2) whether discovery is complete and a trial date has been set, and (3) whether a stay would unduly prejudice or present a clear tactical disadvantage to the non-moving party.” Smarter Agent, 889 F.Supp.2d at 674. The Court has considered these factors and find they disfavor a stay:

53a given that trial is completed and the Court has ruled on the parties’ disputes, no decision from the PTO could have any simplifying effect; the proceedings in this Court are essentially completed, while the reexaminations are ongoing; and a stay would unduly prejudice Dow, which has litigated this case for close to a decade, and prevailed at two trials and on appeal, and is entitled to be paid damages as compensation for all the harm it has suffered.

The Court will deny NOVA’s motion for a stay.

CONCLUSION

For the foregoing reasons, Dow’s request for lost profits and reasonable royalty damages will be granted. Dow’s request for enhanced damages will be denied. NOVA’s request for a stay of entry and execution of judgment will be denied.

ORDER

At Wilmington this 28th day of March, 2014, for the reasons stated in the Memorandum Opinion issued this same date,

IT IS HEREBY ORDERED that:

1. Dow’s request for supplemental damages is GRANTED. The parties will calculate appropriate damages based on the Court’s opinion, plus an appropriate amount of prejudgment and postjudgment interest.

2. NOVA’s motion for stay of entry and execution of judgment (D.I. 746) is DENIED.

3. The parties shall meet and confer and shall submit, no later than April 4, 2014, a proposed form of final judgment consistent with the Court’s rulings issued today.

54a APPENDIX C

NOTE: This disposition is nonprecedential.


———— 2010-1526 ————


Plaintiff-Appellee, v.

NOVA CHEMICALS CORPORATION (CANADA) AND NOVA CHEMICALS INC. (DELAWARE),

Defendants-Appellants. ————

Appeal from the United States District Court for the District of Delaware in case no. 05-CV-0737,

Judge Leonard P. Stark. ————

Decided: January 24, 2012 ————

HENRY J. ROPER, Jenner & Block, LLP, of Chicago, Illinois, argued for plaintiff-appellee. With him on the brief were AARON A. BARLOW and PAUL D. MARGOLIS. Of counsel on the brief were RAYMOND N. NIMROD, Quinn Emanuel Urquhart & Sullivan, of New York, New York.

DONALD R. DUNNER, Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, of Washington, DC, argued for defendants-appellants. With him on the brief were DARREL C. KARL and MARK J. FELDSTEIN. Of counsel on the brief were H. WOODRUFF TURNER and DAVID R. COHEN, K&L Gates, LLP, of Pittsburgh, Pennsylvania.

55a Of counsel were RONALD A. BLEEKER, FORD F. FARABOW, JR., MARTIN I. FUCHS and JOANN M. NETH.

————

Before LINN, PROST, and REYNA, Circuit Judges.

Opinion for the court filed by Circuit Judge PROST.

Dissenting opinion filed by Circuit Judge REYNA.

PROST, Circuit Judge.

Nova Chemicals Corporation (“Nova”) appeals from the district court’s denial of its motion for judgment as a matter of law. Nova argues that the district court should have, in the first place, found that the Dow Chemical Company (“Dow”) lacked standing to bring this suit. Nova also argues that the district court should have set aside a jury verdict of infringement in Dow’s favor and instead found that the patents asserted by Dow are invalid for indefiniteness and lack of an adequate written description and are not infringed. Because we see no error in the district court’s standing and invalidity analyses, and because substantial evidence supports the jury’s infringement finding, we affirm.

BACKGROUND

Dow brought this suit to enforce U.S. Patent No. 5,847,053 (“’053 patent”) and U.S. Patent No. 6,111,023 (“’023 patent”) (collectively, “the patents in suit”). The patents in suit claim a new kind of plastic that is stronger than conventional plastics, which allows, for example, using thinner films (less plastic) for the same purpose. Dow markets its invention as ELITE. Nova’s competing product is named SURPASS. Dow claimed in the district court that SURPASS infringes the patents in suit. Nova put on a three-part defense. First, it argued that Dow lacked

56a standing to enforce the patents in suit. Second, it argued that the patents in suit were invalid for indefi-niteness and lack of an adequate written description.1 Third, it argued that SURPASS did not infringe the patents in suit.

Nova did not prevail on any of its arguments in the district court. The district court held a bench trial to resolve the standing issue and found that Dow had standing to enforce the patents in suit. Dow Chem. Co. v. Nova Chems. Corp., 726 F. Supp. 2d 459, 463-64 (D. Del. 2010). With respect to Nova’s indefiniteness argument, the district court found that the patents were not indefinite as a matter of law and construed the claims. The district court nonetheless allowed the jury to consider whether the patents were invalid for indefiniteness and lack of an adequate written description. The infringement issue was also submitted to the jury. In the end, the jury found the patents in suit valid and infringed and awarded approximately $61.7 million in damages to Dow for lost profits and reasonable royalties. The district court subsequently denied Nova’s renewed motion for judgment as a matter of law and entered judgment in line with the jury’s verdict. This appeal ensued. We have jurisdiction under 28 U.S.C. § 1295(a)(1).

ANALYSIS

Nova makes three main arguments on appeal. First, it argues that Dow lacks standing to enforce the patents in suit. Second, it argues that the patents in suit are invalid for indefiniteness and lack of an adequate written description. Third, it argues that the

1 Nova also argued that the patents in suit were invalid for obviousness. The jury found that the patents were not obvious. Nova does not appeal that determination.

57a jury’s verdict of infringement is not supported by substantial evidence. We address each argument in turn below.

A. STANDING

The standing issue concerns the ownership of the patents in suit. There is no dispute that Dow is indeed the original assignee of the patents in suit and record title holder at the U. S. Patent and Trademark Office (“PTO”). Therefore Dow is the presumed owner of the patents in suit. See SiRF Tech., Inc. v. Int’l Trade Comm’n, 601 F.3d 1319, 1327-28 (Fed. Cir. 2010) (“The recording of an assignment with the PTO is not a determination as to the validity of the assignment. However, we think that it creates a presumption of validity as to the assignment and places the burden to rebut such a showing on one challenging the assign-ment.” (citation omitted)). Effective on January 1, 2002, however, Dow and its holding company, Dow Global Technologies, Inc. (“DGTI”) entered into a “Contribution Agreement” (or “the agreement”) according to which a large share of Dow’s intellectual property rights was transferred to DGTI. Apparently, the Contribution Agreement was intended to generate certain tax benefits for Dow. Nova argues that the patents in suit were among the intellectual property rights that were transferred to DGTI under the Contribution Agreement. As a result, according to Nova, Dow does not have standing to enforce the patents in suit. Cf. Arachnid, Inc. v. Merit Indus., Inc., 939 F.2d 1574, 1579 (Fed. Cir. 1991). Dow disagrees, arguing that it held on to the patents in suit so that it could enforce them in a suit such as this.

After holding a bench trial, the district court deter-mined that the patents in suit were never transferred to DGTI. In particular, the court found that the

58a Contribution Agreement was unambiguous in that it incorporated a document—entitled Schedule A—that contained a list of all the patents that were transferred to DGTI. The court heard and credited testimony from a Dow employee who was in charge of preparing and maintaining Schedule A, and she corroborated Dow’s assertion that the patents in suit never appeared in Schedule A. Based on these findings, the court found that Dow had met its burden of establishing the ownership of the patents in suit. And, because the court found that the clear terms of the agreement controlled, it declined to evaluate the extrinsic evidence that Nova suggested defeated Dow’s standing. The court accordingly denied Nova’s request to dismiss the suit for lack of standing. For the reasons set forth below, we agree with the district court’s determinations.

Our standing analysis presents an issue of contract interpretation: whether Dow transferred the patents in suit to DGTI under the Contribution Agreement. Two sections of the Contribution Agreement (sections 2.01 and 1.07) are particularly important to our analysis. Section 2.01 of the agreement states,

2.01 Transfer of Patent Rights and Technology. Effective on the Transfer date, [Dow] hereby conveys, transfers, assigns and delivers to DGTI, and DGTI hereby accepts from [Dow] as an additional contribution to DGTI’s capital, all of [Dow’s] right and title to and interest in the Patent Rights, Technology and Work Processes, which rights are owned or controlled by [Dow] on the Transfer Date or thereafter.

J.A. 5041-42. This section essentially provides that Dow transferred its “Patent Rights” to DGTI. We must

59a therefore determine whether the patents in suit fit within the scope of “Patent Rights.” That brings us to section 1.07, which defines “Patent Rights” in just two sentences:

1.07 “Patent Rights” means any and all patents and applications for patents of any kind, filed with and/or granted by a gov-ernmental body of the United States or any other country . . . which are owned solely or controlled by [Dow] on the Transfer Date or thereafter, that [Dow] is able to assign to DGTI without the consent of or accounting to a Third Patty or Affiliated Company, without diminishing the royalties paid or payable by or otherwise materially affect-ing the obligations of such Third Party or Affiliated Company with respect to such Patent Rights, and without resulting in a loss of rights. The parties shall provide a schedule of Patent Rights as Schedule A to this Agreement, within ninety (90) days of the Effective Date, and shall provide subsequent supplements thereto from time to time during the Term.

J.A. 5040.

We begin our analysis of the scope of Patent Rights by noting that the first sentence in section 1.07 is not particularly helpful in determining whether the patents in suit were transferred to DGTI. That sentence describes that Patent Rights excludes those patents that cannot be transferred “without resulting in a loss of rights.”2 This sentence cannot be

2 There is no dispute that other than the “loss of rights”

limitation, the remaining language of the first sentence of section

60a interpreted literally because hardly anything can be transferred “without resulting in [some] loss of rights.” Nova and Dow thus each offer their own theory of what this “loss of rights” exception entails. Nova suggests that “loss of rights” only refers to loss of standing in any litigation that was pending when the agreement took effect. According to Nova, therefore, the exception was meant to ensure that any patents that were then involved in litigation remained with Dow. And because the patents in suit were not involved in litigation when the agreement took effect, Nova argues, they were necessarily transferred to DGTI. Dow counters that the “loss of rights” exception was meant not only to protect its standing in then-pending litigation, but also to preserve its ability to recoup lost profits for those patents that would be asserted in future litigation (such as the patents in suit). Neither one of these theories is anchored in the text of the Contribution Agreement.

We are not at liberty, however, to detach our interpretive analysis from the four-corners of the contract at the mere suggestion that one phrase in the contract, viewed in isolation, is not readily amenable to literal interpretation. Rather, we “must give effect to all terms of the instrument, must read the instrument as a whole, and, if possible, reconcile all the provisions of the instrument.” Elliot Assocs. v. Avatex Corp., 715 A.2d 843, 854 (Del. 1998); see generally, 11 Williston on Contracts § 32:5 (4th ed. 2010). As we explain below, to the extent that the phrase “loss of rights” may require interpretation, it does not give us license to open the door to extrinsic

1.07 is immaterial to the standing issue presented here. Therefore, we only focus on the phrase “loss of rights.”

61a evidence (and Dow’s and Nova’s subjective under-standing of the term, for that matter) because the rest of section 2.01 and the agreement as a whole reveal that the patents in suit are not within the scope of Patent Rights.

Unlike the first sentence, the second sentence of section 1.07 makes it abundantly clear that Dow and DGTI intended Schedule A to include a list of all of the transferred patents (among other things).3 In line with our obligation to resolve ambiguities in favor of a harmonious interpretation, we must hold that whatever the term “loss of rights” implies, it cannot serve to wipe out the clear reference to Schedule A. Moreover, “[s]pecific language in a contract controls over general language, and where specific and general provisions conflict, the specific provision ordinarily qualifies the meaning of the general one.” DCV Holdings, Inc. v. ConAgra, Inc., 889 A.2d 954, 961 (Del. 2005). Here, the “loss of rights” phrase is part of a broad exclusionary definition; whereas the reference to Schedule A is inclusionary and, indeed, quite specific. That gives us yet another reason to believe that the specific reference to Schedule A manifests the objective intent of the parties to the agreement and is thus controlling here. As we see it, well-established principles of contract interpretation command us to hold that for the purpose of the standing issue that we are called on to decide, the scope of Patent Rights is not ambiguous. Because the patents in suit do not appear in Schedule A, they were not transferred to DGTI.

3 As we explain below, section 9.07 of the Contribution

Agreement incorporates Schedule A into the agreement.

62a Nova urges us to effectively read Schedule A out of

the Contribution Agreement. It posits that section 9.07 of the Contribution Agreement reveals that Schedule A does not matter at all. To support this argument, Nova selectively recites a portion of section 9.07, which states, “omission of an item from one or more schedules shall not give rise to an implication that DGTI has rights less than those otherwise provided for in this Agreement.” Appellant Br. 11 (quoting J.A. 5046). Based on this snippet of section 9.07, Nova concludes that the contents of the schedules are not controlling. We disagree. Section 9.07 provides,

9.07 Schedules. Each of the schedules refer-enced within this Agreement, prospectively including any updates or amendments thereto, is deemed incorporated herein by reference. While care shall be taken in the provision of the schedules, it is recognized that inadvertent errors may occur. Accord-ingly, inclusion of an item on one or more schedules shall not give rise to rights or an implication that DGTI has rights greater than those expressly provided for in this Agreement. Likewise, omission of an item from one or more schedules shall not give rise to an implication that DGTI has rights less than those otherwise provided for in this Agreement. Upon their mutual rec-ognition of an error in one or more sched-ules, the parties will amend the erroneous item(s) on the affected schedule(s).

J. A. 5046. As it appears in the very first sentence, this section of the contract is meant to incorporate the schedules into the agreement. That alone gives us

63a pause with regards to Nova’s argument, for it would seem odd if the parties intended to incorporate the schedules into the agreement and yet declare them meaningless in the very same section of the agreement. And of course, the remaining language of section 9.07 confirms that the schedules are not meaningless. Section 9.07 provides that the schedules carry meaning unless the parties (Dow and DGTI) agree that a mistake or inadvertent omission has been made. Far from supporting Nova’s interpretation—which uses section 9.07 to wipe out Schedule A—section 9.07 reveals that Dow and DGTI intended the schedules to be of great significance, so much so that they devised a contingency plan to address inadvertent mistakes that might occur during their creation and maintenance. And, of course, even Nova does not seriously contend that any mistake or inadvertent omission has occurred with respect to Schedule A and the patents in suit. Thus, section 9.07 does not provide any basis for us to look beyond the four-corners of the contract.

Nor do we see any basis for Nova’s argument that Schedule A is somehow untrustworthy. Kathleen Max-well, a paralegal at Dow, testified that she was in charge of preparing and maintaining the schedules to the Contribution Agreement from 2002 to September, 2005, three months before this litigation began. Maxwell testified that she prepared Schedule A in 2002 by looking up the patents owned by DGTI in Dow’s Intellectual Property Management System (“IPMS”), which is “a database that holds patent records and agreement records” and is “managed by [Dow’s] Patent Department.”4 J. A. 7111. According to

4 Maxwell mistakenly entitled the Patent Rights schedule as

“Schedule B.” The district court found that the typographical

64a Maxwell, she updated Schedule A in 2004 in the same way, by looking up the patents in IPMS. From 2002 to 2005, Maxwell recalled, many patents were added to Schedule A; indeed, the number of patents included in Schedule A rose from approximately 5,600 to about 7,800. And yet, here is what Maxwell had to say about whether anything was ever taken out of Schedule A:

Q. And do you ever recall removing any patents from the patent rights schedule?

A. No, I do not.

Q. And do you ever recall anyone else removing any patents from the patent rights schedule?

A. No, I do not.

Q. Do you ever recall anybody asking you to remove patents from the patent rights schedule?

A. No, I do not.

J. A. 7111.5 Finally, Maxwell testified that the patents in suit did not appear in Schedule A while she was in

error did not have any substantive effect, and therefore, we see no reason to restate the analysis here. At any rate, we agree with the district court’s finding in this respect as well.

5 The dissent argues that Schedule A cannot control because under section 2.01, the transfer of Patent Rights to DGTI was immediate, whereas Schedule A was not to be prepared until ninety days after the Contribution Agreement went into effect. Dissenting Op. at 11-12. But section 2.01 itself states that Patent Rights may include “rights [that] are owned or controlled by [Dow] on the Transfer Date or thereafter.” J.A. at 5042 (emphasis added). Moreover, section 9.07 also demonstrates that Dow and DGTI allowed flexibility in editing the incorporated schedules (We assume, in line with Kathleen Maxwell’s testimony, that any editing would effect transfer in only one direction, from Dow to DGTI.). Thus, unlike the dissent, we do not understand the

65a charge, thus dispelling any doubt that Dow might have erased the patents in suit from Schedule A in anticipation of litigation between September and December of 2005 (when this suit was filed). The district court expressly found that Maxwell was credible, Dow Chem., 726 F. Supp. 2d at 463, and this aspect of the district court’s decision is virtually unassailable on appeal. Nova’s suggestion that Schedule A is somehow unreliable, therefore, cannot be squared with the record before us.6

In sum, the terms of the Contribution Agreement unambiguously show that the patents in suit were not transferred to DGTI. Moreover, Nova’s arguments with respect to the relevance and authenticity of Schedule A are unfounded. Because the contract terms are clear, we may not look beyond them to analyze Dow’s ownership of the patents in suit. Nova failed to overcome the presumption of title created by the record of assignment filed with the PTO. The district court correctly determined that Dow has standing to enforce the patents in suit.7

“hereby conveys . . .” phrase in section 2.01 to undermine the significance of Schedule A.

6 The Contribution Agreement also incorporates a document entitled Schedule D, which was to contain a list of “Excluded Intangible Assets.” J.A. 5040, ¶ 1.03. Dow and Nova dispute the content of Schedule D, and each hypothesizes how the content of Schedule D should affect the standing analysis. There is nothing in the Contribution Agreement, however, that suggests Schedule D is related to the scope of Patent Rights, and so we see no need to explore the issue any further.

7 As we explained, unlike the dissent, we believe that the terms of the Contribution Agreement are not ambiguous. But even if we were to look beyond the four-corners of the contract, we would find no basis for the dissent’s suggestion that the extrinsic evidence counsels reversing the district court’s standing

66a

determination. We note that the cornerstone of the dissent’s analysis of the extrinsic evidence is a chain of Dow’s intra-office e-mail communications. The content of the e-mails is disputed, however, and, as we read them, they do not conclusively establish that Dow transferred the patents in suit. The dissent’s interpretation of the e-mails is based mainly on one specific e-mail, in which one of Dow’s attorneys (Mr. Bruce Kanuch) suggests that the patents that were then in litigation remain with Dow. Dissenting Op. at 17-18 (citing J.A. 5663). The dissent infers from this one e-mail that the remaining patents were transferred. Dissenting Op. at 18-19. But the e-mail itself says nothing about what should happen to the patents in suit, and in any event, there is no evidence that the suggestion in this one e-mail was ever adopted by or incorporated into the Contribution Agreement. It is true that the next e-mail in the chain states that “the issue” was addressed by adding the phrase “loss of rights” to the contribution Agreement, J.A. 5663, but this subsequent e-mail does not suggest that the phrase “loss of rights” was limited to a loss of standing in then-pending litigation. On the contrary, it is entirely plausible (and in our view, likely) that “the issue” addressed by the addition of the phrase “loss of right” was Dow’s “legal standing to bring and/or maintain [suit].” Id. (emphasis added). Therefore, as the record before us stands, the e-mails do not shed much light onto the meaning of “loss of rights.” We also disagree with the dissent’s choice to foray into analyzing Dow’s tax incentives in structuring the Contribution Agreement. In our view, the record does not reveal what, if any, tax benefits Dow received from the purported transfer of the patents in suit. Even if the evidence did reveal some tax benefits, however, it will not tell us much about the parties’ objective intent in entering into the Contribution Agreement when the agreement took effect. Finally, even if we were in a position to consider the totality of the extrinsic evidence (including the e-mails and the alleged tax incentives) for the first time on appeal, we would find nothing more compelling in the record than Schedule A—which at the very least should serve as a telling piece of extrinsic evidence. In sum, we respectfully disagree both with the dissent’s decision to take on the analysis of the extrinsic evidence in the first place, and also with regard to the results.

67a B. INDEFINITENESS

The district court also correctly found that the patents in suit were not indefinite.8 A patent specifica-tion must “conclude with one or more claims particu-larly pointing out and distinctly claiming the subject matter which the applicant regards as his invention.” 35 U.S.C. § 112, ¶ 2. This requirement is satisfied where “one skilled in the art would understand the bounds of the claim when read in light of the specifica-tion . . . .” Exxon Research & Eng’g Co. v. United States, 265 F.3d 1371, 1375 (Fed. Cir. 2001). A claim is not indefinite merely because it is difficult to construe. Id. To be indefinite, a claim term must be such that “no narrowing construction can properly be adopted” to interpret the claim. Id. Indefiniteness is a question of law that this court reviews de novo. Star Scientific, Inc. v. R.J. Reynolds Tobacco Co., 655 F.3d 1364, 1373 (Fed. Cir. 2011); Bancorp Servs., LLC v. Hartford Life Ins. Co., 359 F.3d 1367, 1371 (Fed. Cir. 2004); Exxon, 265 F.3d at 1376.

The patents in suit are directed at polymer composi-tions. The only asserted independent claim of the ’053 patent is representative claim 6, which recites,

6. An ethylene polymer composition comprising

(A) from about 10 percent (by weight of the total composition) to about 95 percent (by weight of the total composition) of at least one

8 Because the district court provided a construction to the jury,

which was the only basis upon which the jury could reach the conclusion it did, we do not need to reach the question of whether it was error to submit the question of indefiniteness to the jury: Even had the district court not done so, the outcome would be no different.

68a homogeneously branched linear ethylene/a-olefin interpolymer having:

(i) a density from about 0.89 grams/cubic centimeter (g/cm3) toabout 0.935 g/cm3,

(ii) a molecular weight distribution (MW/MN) from about 1.8 to about 2.8,

(iii). a melt index (I2) from about 0.001 grams/10 minutes (g/10 min) to about 10 g/10 min,

(iv) no high density fraction,

(v) a single melting peak as measured using differential scanning calorimetry, and

(vi) a slope of strain hardening coefficient greater than or equal to 1.3; and

(B) from about 5 percent (by weight of the total composition) to about 90 percent (by weight of the total composition) of at least oneheterogeneously branched linear ethylene polymer having a density from about 0.93 g/cm3 to about 0.965 g/cm3.

’053 patent col.16 ll.4-26 (emphasis added). Claim 1, the only independent claim of the ’023 patent, claims a different ethylene polymer, but it too recites a particular component with “a slope of strain hardening coefficient greater than or equal to 1.3.”9 ’023 patent col.16 ll.30-31.

9 Although the patents in suit disclose different polymer

combinations, the differences between them are not material to our analysis. For the sake of convenience, we quote language from the ’053 patent throughout our opinion but still use the phrase “patents in suit” to make clear that our analysis applies to the asserted claims of the ’023 patent as well.

69a It is the “slope of strain hardening” (“SHC”)

coefficient that is at the center of Nova’s indefiniteness argument. The SHC coefficient is a new Dow con-struct, not previously known in the art, defined by the patents in suit as the slope of a material’s strain hardening multiplied by the melt index raised to the 0.25 power.10 ’053 patent col.6 ll.45-50. The patents in suit teach that in order to determine a material’s slope of strain hardening, one must first obtain a “stress/strain curve,” which results when the tensile properties of the test sample is tested on a tensile tester. Id. at col.6 ll.24-29. The slope of the strain hardening is then “calculated from the resulting tensile curve by drawing a line parallel to the strain hardening region of the resulting stress/strain curve.” Id. at col.6 ll.27-29.

Nova argues the patents in suit do not adequately teach how one must determine the value of the SHC coefficient for the claimed polymer because 1) the patents in suit do not contain a schematic depiction of the tensile curve of the claimed material, and 2) the patents in suit do not disclose the suitable measure-ment units for measuring the value of the SHC coefficient. Based on all the evidence that is presented to us in the record, however, we agree with the district court’s determination that the patents in suit are not indefinite.

Nova first argues that the patents in suit do no in-clude a schematic example of the strain/stress curve, and posits that the patents in suit are indefinite as a result. In particular, Nova suggests that without the aid of a drawing, one of ordinary skill in the art would

10 SHC = (slope of stain hardening) * (I2)0.25. ’053 patent col.

6 l.47.

70a not know at what part along the stress/strain curve the slope must be measured. We disagree. It is true that the patents in suit state that “FIG. 1 shows the various stages of the stress/strain curve used to calculate the slope of strain hardening,” and yet the patents in suit do not, for whatever reason, include the promised drawing. ’053 patent col.6 ll.40-41. But that does not suggest that one of ordinary skill in the art would not be able to determine the slope of the strain hardening for the SHC coefficient. Nova’s own expert witness, Dr. Fuller, agreed with Dow’s attorney that a typical stress/strain curve was “very, very well known [to a] person of ordinary skill in the art . . . who worked with semi-crystalline polymers and polyethylene,” and that one of ordinary skill in the art would come across similar curves in relevant textbooks. J.A. 3564-65. The mere fact that Figure 1 was missing from the patents in suit, therefore, does not render them indefinite.11 And more importantly, Dow established that one of ordinary skill in the art would know at which particular part along the curve the slope of the stress/strain curve should be measured. The patents in suit teach that strain hardening occurs, or is reflected, at a specific region of the stress/strain curve:

The strain hardening occurs after the sample has pulled its initial load ((i.e., stress) usually with lit-tle or no elongation during the initial load) and af-ter the same has gone through a slight drawing stage (usually with little or no increase in load, but with increasing elongation (i.e., strain)). In

11 We note that the patents in suit merely state that Figure 1

was intended to depict “the various stages of the stress/strain curve,” but they do not necessarily suggest that Figure 1 would depict the specific point along the curve at which the slope should be measured. ’053 patent col.6 l.40.

71a the strain hardening region, the load and the elongation of the sample both continue to in-crease. The load increases in the strain hardening region at a much lower rate than during the initial load region and the elongation also increase, again at a rate lower than that experienced in the drawing region.

’053 patent col.6 ll.30-39. In other words, although there are multiple “regions” on a stress/strain curve, only one region on the curve is the “strain hardening region,” where the slope of the curve must be measured.

Nova objects that the strain hardening region is itself a curve, not a straight line. It points to the testimony of Dow’s own expert witness, Dr. Hsiao, who indeed admitted that most strain hardening data samples gathered from the stress/strain test reveal some curvature (when graphed), and that curves do not have a single slope. Nova thus argues that the patents in suit are indefinite. We disagree. Dr. Hsiao explained that one of ordinary skill in the art would understand that during the initial portion of the strain hardening region, there is a mixture of drawing effects and strain hardening effects. During the draw region, the material deforms without increasing the load. Beyond that point, the test sample hardens, and, eventually, it breaks. According to Dr. Hsiao, one of ordinary skill in the art would know that the slope of the hardening curve would have to be measured at its maximum value, which reflects the best tensile performance of the material.

Nova further notes that “Dow’s internal files and later disclosures contain multiple definitions for where the slope of strain hardening for SHC should be determined.” Appellant Br. 25. In particular, Nova

72a points to some of Dow’s internal documents that reveal Dow indeed experimented with four different methods to measure the slope of the strain hardening curve. Nova argues, accordingly, that there is no single method for one of ordinary skill in the art to measure the slope, and that the failure of the patents in suit to identify one distinct method renders them indefinite. Again, we disagree. To begin with, whether Dow used various methods to measure the slope of the strain hardening curve is of questionable significance be-cause there is no evidence to suggest that the experimentations necessarily involved practicing the claimed method. And in any event, “[t]he claims are not indefinite even if some experimentation is required to determine the exact [scope of the claims].” Enzo Biochem, Inc. v. Applera Corp., 599 F.3d 1325, 1336 (Fed. Cir. 2010), cert. denied, 131 S. Ct. 3020 (2011); see also Exxon, 265 F.3d at 1379 (“Provided that the claims are enabled, and no undue experimentation is required, the fact that some experimentation may be necessary to determine the scope of the claims does not render the claims indefi-nite.”). We already noted, however, that Dow has established that one of ordinary skill in the art would know that the maximum slope of the stress/strain curve was the appropriate value for calculating the SHC coefficient. At best, Nova has shown that other regions in the slope may also be measured. But that does not necessarily suggest that one of ordinary skill in the art would not realize that the maximum slope leads to the most appropriate reading of the strain hardening slope for the purposes of the patents in suit, or that it would be too difficult for one or ordinary skill in the art to make a few measurements and determine, based on the result, what the scope of the invention is. In other words, the mere fact that the slope may be

73a measured in more than one way does not make the claims of the patent invalid. See Exxon, 265 F.3d at 1375.

Next, Nova argues that the patents in suit are indefinite because they do not disclose the unit of measurement for the SHC coefficient. It is true that the patents in suit do not specify any particular unit for the SHC coefficient. But the specification teaches that the stress/strain test is conducted with an Instron Tensile Tester “at a crosshead speed of 1 inch/minute.” ’053 patent col.6 l.26. Experts for Dow and Nova agreed that the user manual for the Instron Tensile Tester, available when the patents in suit were filed, specified that when the crosshead speed is inches per minute, the units for load and elongation are pounds and inches (English units), unless expressly specified otherwise. And, the manual also showed that when the user conducts the stress/strain test using crosshead speeds in inches per minute, the output measurement is reported in English units. Consistent with these instructions, Table 3 of the patents in suit also reports the output of the Instron Tensile Tester (e.g., yield, tensile strength, and toughness) in English units. Because the specification (directly in Table 3 and indirectly via the Instron manuals) teaches that all measurement units that are relevant to the determination of the slope of strain hardening are made in English units, one of ordinary skill on the art would also realize that the slope of the strain hardening should be determined in English units.

Finally, Nova argues that one of ordinary skill in the art would not realize that the slope of the strain hardening region should be measured in English units because the equation for the SHC coefficient also incorporates the melting index, and the patents in suit

74a report the melting index in metric, not English, units. See ’053 patent col.6 l.47. We disagree. Nova has not presented any evidence that shows an equation, for a proprietary coefficient indeed, may not combine variables measured in different measurement systems. And in any event, the test for indefiniteness is not whether the scope of the patent claims is easy to determine, but whether “the meaning of the claim is discernible, even though the task may be formidable and the conclusion may be one over which reasonable persons will disagree . . . .” Exxon, 265 F.3d at 1375. As we have already explained, one of ordinary skill in the art would realize that the slope of the strain hardening, as defined in the patents in suit, should be measured and reported in English units. Therefore, Nova’s final argument regarding indefiniteness fails. In sum, because one of skill in the art would understand the bounds of the claims, the district court correctly rejected Nova’s indefiniteness challenge.12

C. INFRINGEMENT

Nova’s final challenge to the district court’s denial of its motion for judgment as a matter of law targets the jury’s finding of infringement. We review the district court’s denial of Nova’s motion for judgment as a matter of law under the standard of review of the regional circuit. ACCO Brands, Inc. v. ABA Locks Mfr. Co., 501 F.3d 1307, 1311 (Fed. Cir. 2007). The Third Circuit reviews de novo a district court’s denial of judgment as a matter of law. McKenna v. City of

12 Nova also argues, essentially based on the same contentions

made in its indefiniteness appeal, that the patents in suit do not meet the written description requirement of 35 U.S.C. § 112, ¶ 1. Based on our analysis above, we also reject Nova’s written description arguments.

75a Philadelphia, 649 F.3d 171, 176 (3d Cir. 2011). Infringement is a question of fact, and we review the jury’s verdict of infringement for substantial evidence. Finjan, Inc. v. Secure Computing Corp., 626 F.3d 1197, 1202 (Fed. Cir. 2010).

Here, the jury’s verdict of infringement is supported by substantial evidence. As we already stated, the plastic claimed in the patents in suit contains two components, Component A and Component B. There is no dispute that Nova’s accused product contains Component A. The infringement dispute revolves around one particular limitation in the composition of Component B.13 Specifically, Nova argues that Dow did not present sufficient evidence that showed the high density component of Nova’s accused product, referred to as “HD fraction,” is “heterogeneously branched,” as required by the patents in suit. ’053 patent col.16 l.24. We disagree. Dr. Soares, Dow’s expert witness, testified that he conducted two different analyses to determine whether Nova’s HD fraction is heterogeneously branched. First, Dr. Soares stated that he studied Nova’s manufacturing process, including Nova’s own modeling of its reactor, and ex-plained that due to the non-uniformity of the reactor zone (the ratio between the ethylene and octane in various areas surrounding the area in the reactor where the HD fraction is formed), molecules with different amounts of branching are produced. In other words, he explained, the HD fraction is heter-ogeneously branched. Second, Dr. Soares testified that he performed a “cross fractionation” analysis, which

13 The remaining limitations of the patents in suit that are

relevant to Component B are satisfied by the high density component of Nova’s accused product. We do not address them here.

76a also revealed that the HD fraction is heterogeneously branched.

Nova argues that whether Component B is “heter-ogeneously branched” is not relevant because the district court construed the term “heterogeneously branched” as having “branching different from and broader than the homogenously branched component.” Appellant Br. 63; see also J.A. 110. Nova argues, rather, that in order to evaluate infringement, one must “compare the relative distribution exhibited by Nova’s [HD Fraction].” Appellant Br. 64. We are skeptical of the logic of this hyper-technical analysis because it implies that the district court erred in its claim construction—which is not challenged on appeal. But in any event, Dr. Soares testified that the particular characteristics of the mixture of ethylene and octane in Nova’s reactors results in “different branching levels” or “broadening of the distribution [of branching]” in the HD fraction. J.A. 2078-79. We are persuaded that Dr. Soares’s testimony gave the jury sufficient justification to find that the accused polymer has “branching different from and broader than [the] homogeneously branched [component].” J.A. 110. Therefore, whether the infringement analysis is performed with attention to the phrase “heterogene-ously branched” or by focusing on the specific language of the district court’s claim construction, it leads to the same result. Substantial evidence supports the jury’s finding of infringement in Dow’s favor.

CONCLUSION

For the foregoing reasons, we affirm the judgment entered against Nova.

AFFIRMED

77a NOTE: This disposition is nonprecedential.


————


Plaintiff-Appellee, v.

NOVA CHEMICALS CORPORATION (CANADA) AND NOVA CHEMICALS INC. (DELAWARE),

Defendants-Appellants. ————

2010-1526 ————

Appeal from the United States District Court for the District of Delaware in case no. 05-CV-0737,

Judge Leonard P. Stark.

————

REYNA, Circuit Judge, dissenting.

This patent infringement case involves a substan-tial question of standing based on an agreement relating to the ownership of the patents-in-suit. In order to achieve certain tax and business benefits, Dow transferred essentially its entire patent portfolio to its holding company pursuant to an agreement entered into in 2002. Dow sued Nova in 2005 for infringement of the patents-in-suit, which were ostensibly transferred to Dow’s holding company under the 2002 agreement. The 2002 agreement and related documents, however, were not produced in litigation by Dow until July 2009, well after discovery had closed. After reviewing the documents, Nova moved to dismiss the case on grounds that Dow lacked

78a standing because it was not the owner of the patents-in-suit when the lawsuit was initiated. The district court opted not to have a hearing on the standing issue until after a jury trial and verdict on the merits of the infringement and invalidity claims. Ultimately, the district court found that the patents-in-suit had never been transferred by Dow to its holding company via the 2002 agreement and, concluding that Dow therefore had standing, entered final judgment on the verdict against Nova.

Because I conclude that the 2002 agreement in fact did transfer the patents-in-suit to Dow’s holding company, and that standing did not exist at the time the complaint was filed, I would reverse the district court and dismiss the case without prejudice. I would not reach the underlying merits of the judgment that the asserted claims of the patents-in-suit were valid and infringed. I respectfully dissent.

I. BACKGROUND

A. The Agreements Between Dow and DGTI

The Dow Chemical Company (“Dow” or “TDCC”) is the original assignee of U.S. Patent Nos. 5,847,053 and 6,111,023 (the “patents-in-suit”), which are directed to polymer compositions for a stronger form of polyethylene. Dow later established Dow Global Technologies, Inc. (“DGTI”) as a holding company and entered into a Contribution Agreement with DGTI effective January 1, 2002. The recitals of the Contribution Agreement explained that Dow intended to “contribute to DGTI . . . all TDCC Patent Rights . . . for the licensing thereof by DGTI to TDCC. . . .” A5039. As explained in more detail below, this arrangement afforded certain tax advantages to Dow.

79a All of Dow’s “Patent Rights” were broadly assigned

to DGTI under Section 2.01 of the Contribution Agreement, which provided that “TDCC hereby conveys, transfers, assigns and delivers to DGTI . . . all of TDCC’s right and title to and interest in the Patent Rights, Technology and Work Processes, which rights are owned or controlled by TDCC on the Transfer Date . . . .” A5041-42 (emphasis added). Central to this appeal is the question of whether the patents-in-suit were among the transferred “Patent Rights,” which were defined in Section 1.07 as follows:

“Patent Rights” means any and all patents and applications for patents of any kind, filed with or granted by a governmental body of the United States or any other country . . . which are owned solely or controlled by TDCC on the Transfer Date or thereafter . . . that TDCC is able to assign to DGTI without the consent of or accounting to a Third Party or Affiliated Company, without diminishing the royalties paid or payable by or otherwise materially affecting the obligations of such Third Party or Affiliated Company with respect to such Patent Rights, and without resulting in a loss of rights. The parties shall provide a schedule of Patent Rights as Schedule A to this Agreement, within ninety (90) days of the Effective Date, and shall provide subsequent supplements thereto from time to time during the Term.

A5040. This definition and the parties’ understanding of its meaning are critical to the resolution of this case.

A Schedule A of Patent Rights was not prepared within 90 days of the Effective Date, as was contemplated under Section 1.07. However, the Contribution Agreement did not make the transfer of

80a Patent Rights contingent on the creation or ultimate content of Schedule A. The substantive language of the agreement—not the schedules—was intended to be controlling as to the rights and obligations of the parties. In particular, Section 9.07 provided that while schedules were incorporated by reference into the agreement, the inclusion or omission of an item from a schedule “shall not give rise to rights or an implication that DGTI has rights greater than those expressly provided for in this Agreement” or “give rise to an implication that DGTI has rights less than those otherwise provided for in this Agreement,” respec-tively. A5046. Thus, the Contribution Agreement overall provided that upon execution DGTI was to receive all of Dow’s “Patent Rights” as generally defined above, regardless of whether Schedule A existed or what might have been listed on it.

In accordance with the stated purpose of the Contri-bution Agreement, Dow and DGTI simultaneously entered into a Patent and Technology License Agreement (“PTLA”), whereby DGTI licensed back to Dow patent rights transferred under the Contribution Agreement on a non-exclusive, royalty-bearing basis. The PTLA provided mechanisms for Dow to seek enforcement of Licensed Patent Rights through DGTI’s reassignment of any transferred patents to Dow, or by DGTI permitting Dow to file suit in DGTI’s name. At Dow’s request, DGTI was required to promptly assign patents to Dow “in a manner that avoids loss of rights.” A5590.

An overall objective of this ownership and licensing scheme established between Dow and DGTI was for Dow to realize certain tax benefits. For the scheme to work, the holding company DGTI was required to be the owner of the Patent Rights, and to then license the

81a patents back to Dow in exchange for royalty payments. Indeed, between 2005 and the third quarter of 2009, approximately $68 million in royalties were paid by Dow to DGTI for its “ELITE” family of products, which are covered by the ’023 patent. For these payments, DOW does not contest that it obtained a two percent (after federal tax) state tax savings. Dow contends that these royalty payments were for “Technology” and “Work Processes” such as trade secrets transferred by the Contribution Agreement and licensed under the PTLA, not the ’023 patent. No documentary evidence in the record apportions out the royalty payments, and witnesses testified that they had “no basis to know” and were “not sure” to what extent the royalty payments were attributable to licensed patent rights as opposed to other intellectual property. A7106, A7140.

While the royalties recited in the PTLA are expressed in terms of “Technology” and “Work Processes,” neither of which is defined to expressly include “Patent Rights,” the PTLA makes clear that Dow was to pay those royalties “[i]n consideration of the licenses . . . granted [to Dow],” which include a license to use the Licensed Patent Rights. A5582-83. Indeed, one of the PTLA’s preambles refers to Dow obtaining a “royalty-bearing non-exclusive license to the Intangible Assets owned by DGTI,” and “Intangible Assets” are defined as including the “Patent Rights” transferred to DGTI under the Contribution Agreement. A5576, A5578. Moreover, “Patent Rights” are clearly related to “Technology” under the PTLA, since “Licensed Patent Rights” are defined as “that portion of Patent Rights that are relevant to the manufacture, sale and direct or indirect use of Licensed Products [i.e., products manufactured with Licensed Technology] . . . or to the

82a utilization of Licensed Processes [i.e., methods and techniques for manufacturing products with Licensed Technology] . . . .” A5579 (emphasis added). Royalties were thus paid by Dow to DGTI at least in part for the grant-back licenses to the Patent Rights under the PTLA.

B. Litigation and Discovery Conduct By Dow

Dow filed its patent infringement complaint against NOVA Chemicals Corporation and NOVA Chemicals Inc. (collectively, “NOVA”) on October 21, 2005. It was not until June 19, 2009, five months after discovery closed, that Dow produced the Contribution Agreement in response to NOVA’s outstanding requests for production. The Contribution Agreement was accompanied by a document entitled “Schedule A-Patent Rights,” which contained no listing of patents, but was a single sheet stating that “this Schedule includes all Patent Rights of [Dow] . . . excluding Excluded Patent Rights set forth in Schedule ‘D.’” A5520. Also produced was a document entitled “Schedule D: Excluded Patents,” which did contain a listing of patents and included the patents-in-suit. A5521-74. This Schedule D had been updated by Dow to add the patents-in-suit to it right before it was produced. A7147. Lastly, Dow produced a Quitclaim Deed dated June 15, 2009—four days prior to production and more than three and a half years after the lawsuit was filed—which assigned to Dow “all of DGTI’s right, title, and interest to the Patents[-in-suit], if any.” A5092-93. The Quitclaim Deed was purportedly intended “to remove any potential doubt as to ownership of the patents[-in-suit].” Id.

While it is clear that Nova’s discovery requests spurred Dow to update the Schedule D and execute the Quitclaim Deed, the record does not explain why Dow

83a waited so long to produce the previously existing docu-ments. The record also does not reflect the nature and extent of Dow’s pre-filing investigation with respect to standing, which presumably would have revealed those existing documents four years prior, in 2005, when the lawsuit was filed.

After receiving and reviewing the Contribution Agreement, Schedules A and D, and the Quitclaim Deed, Nova pressed Dow for additional related documents bearing on standing. Dow then produced the original Schedule D from 2002 which, unlike the previously produced and recently updated Schedule D, did not list the patents-in-suit as “Excluded Patents.” Dow also produced the December 15, 2005 version of a document labeled “Schedule B Supplement,” which Dow’s paralegal testified was intended to be Schedule A to the Contribution Agreement. Unlike the previ-ously produced Schedule A of Patent Rights, the Schedule B Supplement comprised a listing of patents, but it did not include the patents-insuit. Dow’s paralegal testified that she did not know what modifications were made to the Schedule B Supple-ment as it existed prior to the December 15, 2005 version that was produced. Testimony also suggested that the Schedule B Supplement was a print-out of a query to an internal patent database for DGTI patents, which database was not updated to reflect the transfer of patents under the Contribution Agreement.

Based on these documents, NOVA believed that Dow transferred the patents-in-suit to DGTI in 2002 and did not own them when the lawsuit was filed. Nova moved to dismiss for lack of standing or, in the alternative, for full standing discovery. Nova’s motion was pending and languished for nine months, at which time the district court finally denied NOVA’s request

84a that standing be addressed before the infringement trial. The district court did, however, allow limited standing discovery including abbreviated depositions of Dow’s witnesses.

With the threshold standing issue still unresolved, the infringement trial proceeded. The jury found the patents-in-suit to be infringed and not invalid, and awarded Dow damages of $61.8 million. The district judge held a bench trial on standing the following day and ultimately denied NOVA’s motion to dismiss for lack of standing and entered judgment in favor of Dow. Dow Chem. Co. v. Nova Chems. Corp., 726 F. Supp. 2d 459, 463-64 (D. Del. 2010) (“Standing Op.”).

The district court found the Contribution Agree-ment to be clear on its face and held that “a transfer of the patents-in-suit is not effectuated unless and until the patents are explicitly listed on Schedule A.” Id. at 462-63. The district court considered testimony from Dow’s witnesses and found that the Schedule B Supplement produced by Dow was “in fact, intended to be Schedule A and used by the parties as Schedule A.” Id. at 463-64. Because the Schedule B Supplement did not list the patents-in-suit, in the district court’s judgment the patents-in-suit were not transferred to DGTI under the Contribution Agreement, and Dow had standing to bring and maintain the lawsuit. Id.

II. DISCUSSION

Standing is a threshold jurisdictional question which we review de novo. Mars, lnc. v. Coin Acceptors, Inc., 527 F.3d 1359, 1367 (Fed. Cir. 2008). The proper interpretation of a contract is a question of law that is also reviewed de novo. First Annapolis Bancorp, Inc. v. United States, 644 F.3d 1367, 1373 (Fed. Cir. 2011). Dow has the burden of proving standing to sue, and

85a must demonstrate by a preponderance of the evidence that it held enforceable title on the date the complaint was filed. Tyco Healthcare Group LP v. Ethicon Endo-Surgery, Inc., 587 F.3d 1375, 1378 (Fed. Cir. 2009); Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (U.S. 1992).1 The threshold issue of standing must be satisfied in all cases, as it is “an essential and unchanging part of the case-or-controversy require-ment of Article III.” Lujan, 504 U.S. at 560.

The Contribution Agreement indicates that its interpretation “shall be governed by and construed in accordance with the laws of the state of Delaware, without regard to principles of conflicts of laws,” and so Delaware’s principles of contract interpretation are to be applied in this case. A5046; Parental Guide of Tex., Inc. v. Thomson, Inc., 446 F.3d 1265, 1269 (Fed. Cir. 2006) (“Contract interpretation is a matter of state law.”). As explained by the Supreme Court of Delaware,

In analyzing disputes over the content of a con-tract, we give priority to the intention of the par-ties. We start by looking to the four corners of the contract to conclude whether the intent of the par-ties can be determined from its express language. In interpreting contract language, clear and unambiguous terms are interpreted according to their ordinary and usual meaning. We will also construe the agreement as a whole, giving effect

1 While Dow received a Quitclaim Deed to the patents-in-suit

from DGTI effective June 15, 2009, such a nunc pro tunc assignment cannot confer standing retroactively. Abraxis Bioscience, lnc. v. Navinta, LLC, 625 F.3d 1359, 1366-67 (Fed. Cir. 2010) (“Abraxis was required to have legal title to the patents on the day it filed the complaint and that requirement can not be met retroactively.”).

86a to all provisions therein, conscious of the fact that the meaning which arises from a particular por-tion of an agreement cannot control the meaning of the entire agreement where such inference runs counter to the agreement’s overall scheme or plan. Keeping these rules in mind, we should look to harmonize the entire agreement and remain consistent with the objective intent of the parties that drafted the contract.

Land-Lock, LLC v. Paradise Prop., LLC, 963 A.2d 139 (Del. 2008) (Table) (citations and quotations omitted). Thus, Delaware courts are required to read a contract as a whole and to give effect to each provision thereof in order not to render any part of the contract “meaningless or illusory.” Estate of Osborn v. Kemp, 991 A.2d 1153, 1159 (Del. 2010).

While parties are generally bound by the plain meaning of the contractual language, such language is properly deemed ambiguous “when the provisions in controversy are reasonably or fairly susceptible of different interpretations or may have two or more different meanings.” AT&T Corp., v. Lillis, 953 A.2d 241, 252-53 (Del. 2008). If a Delaware court finds that a disputed contract term is ambiguous, then the “consideration of extrinsic evidence is required” to determine the intended meaning of the parties. Id. at 253 (quoting Appriva Shareholder Litig. Co., LLC v. ev3, Inc., 937 A.2d 1275, 1291 (Del. 2007)) (emphasis added); see also Eagle Industries, Inc. v. DeVilbiss Health Care, Inc., 702 A.2d 1228, 1232 (Del. 1997) (“When the provisions in controversy are fairly susceptible of different interpretations or may have two or more different meanings, there is ambiguity. Then the interpreting court must look beyond the

87a language of the contract to ascertain the parties’ intentions.”) (emphasis added).

Looking to the intention of the parties as reflected by the four corners of the Contribution Agreement, it is clear that the Contribution Agreement was intended to effectuate a broad mass transfer of patents from Dow to DGTI so that DGTI could grant back a license to Dow. Only certain patents subject to three specified exceptions under Section 1.07 of the Contribution Agreement were not subject to the transfer. The first two exceptions, which are not at issue in this case, encompassed patents that cannot be transferred without affecting the rights or obligations of Dow, its Affiliated Companies, or third parties under prior agreements or assignments relating to Dow’s patents. The third exception, which is disputed and central to this appeal as discussed below, encompassed patents for which transfer “would result in a loss of rights.”

The threshold jurisdictional issue before us is whether the patents-in-suit were excluded from trans-fer under the Contribution Agreement. Resolution of this issue centers around the proper interpretation of Section 1.07, which requires a careful analysis of the purpose of Schedule A, the meaning of the “loss of rights” provision in the definition of Patent Rights, and other extrinsic evidence offered to show the parties’ intent. Guided by the above principles of Delaware contract law, I address each of these matters in turn.

A. The Purpose of Schedule A

The district court erred in finding that Schedule A was the legally operative document that effectuated all transfers of patents under the Contribution Agreement. The operative transfer language is

88a provided in Section 2.01. A5041-42 (“TDCC hereby conveys, transfers, assigns and delivers to DGTI . . . all of TDCC’s right and title to and interest in the Patent Rights . . . .”). Section 1.07 defines the transferred Patent Rights as “any and all patents” owned by Dow that Dow can assign without implicating one of three exceptions, none of which reference Schedule A. Nowhere in the Contribution Agreement is the transfer predicated or dependent upon whether patents are listed on Schedule A. Indeed, Section 9.07 makes clear that the contents of the schedules are not controlling. Moreover, Section 2.01 provides that Dow “hereby” transfers the patents, which strongly indicates an immediately effective transfer, while Schedule A was not even required to be completed until after the Contribution Agreement was executed. See Abraxis, 625 F.3d at 1364-65 (distin-guishing a party who “hereby assigns” rights from one that merely “agrees to assign” such rights in the future); DDB Techs., L.L.C. v. MLB Advanced Media, L.P., 517 F.3d 1284, 1290 (Fed. Cir. 2008) (contrasting a present assignment of rights to future inventions, which causes transfer by operation of law when a future invention comes into being, with a promise or obligation to assign those same rights in the future).

To find that no patents were transferred unless and until listed on the Schedule A ignores Section 9.07, nullifies the transfer set forth in Section 2.01, renders superfluous the detailed and specific definition of Patent Rights in Section 1.07, and rearranges the fundamental purpose of the tax and business scheme intended under the agreement as a whole. Such a reading would cause most of the Contribution Agreement to be “meaningless or illusory.” Osborn, 991 A.2d at 1159. The reference to Schedule A in the Contribution Agreement shows that the parties

89a desired to make and maintain a listing of the patents that were transferred to DGTI as a matter of convenience, not as a prerequisite to a valid transfer.

The majority takes great effort in arguing that Schedule A necessarily dictates the operation of the agreement. Because Section 9.07 acknowledges that “inadvertent errors” may occur in the preparation of the schedules and provides that that these errors should be corrected by the parties, the majority believes that Schedule A is intended to be controlling unless the parties mutually agree that a mistake or omission has been made in its preparation. A5046. This view turns the Contribution Agreement on its head by eviscerating Section 1.07’s definition and inflating the role of Schedule A without any basis in the Contribution Agreement or Delaware law. Under Section 9.07, any erroneously included or omitted items from the schedules “shall not give rise to rights or an implication that DGTI has rights greater than those expressly provided for in this Agreement” or “give rise to an implication that DGTI has rights less than those otherwise provided for in this Agreement,” respectively. A5046. Section 9.07 is thus better understood as a provision whereby the parties expected that Schedule A would accurately reflect the transferred Patent Rights, and to the extent Schedule A did not accord with the definition of Patent Rights in Section 1.07—i.e., it included “inadvertent errors”—Section 1.07 would control and Schedule A would be appropriately updated.

While the majority focuses on whether Schedule A is “meaningful,” the real issue before us is whether Schedule A alone dictates which patents were transferred from Dow to DGTI. The language of Sections 1.07, 2.01, and 9.07, when read together to

90a give effect to the intended scheme of the Contribution Agreement, makes clear that it does not.

B. The Meaning of “Loss of Rights”

Dow argues in the alternative that the patents-in-suit did not fall within the definition of Patent Rights that Dow transferred to DGTI. As noted above, in Section 1.07 there were three circumstances which excepted a patent from being transferred: (1) the transfer would require “the consent of or accounting to a Third Party or Affiliated Company”; (2) the transfer would “diminish[] the royalties paid or payable by or otherwise materially affecting the obligations of such Third Party or Affiliated Company with respect to such Patent Rights”; or (3) the transfer would result in “a loss of rights.” A5040. Dow does not contend that the transfer of the patents-in-suit would be precluded under the two former exceptions. Rather, Dow claims that the patents-in-suit were not transferred because such a transfer would have resulted in a “loss of rights” to Dow, namely, Dow’s ability to recover lost profits from NOVA by not owning the patents during the period of NOVA’s alleged infringement. Dow’s position would therefore preclude transfer of any and all enforceable patents covering technology that Dow was then using or might have begun using in the future.

Unlike Dow, the majority declines to address the meaning of the “loss of rights” clause at all. The majority believes that in the context of Section 1.07, Schedule A is a “quite specific” provision, whereas the phrase “loss of rights” is “part of a broad exclusionary definition,” such that Schedule A must trump and substitute for the general definition because the “specific and general provisions conflict.” Maj. Op. at 8 (citing DCV Holdings, Inc. v. ConAgra, Inc., 889 A.2d 954, 961 (Del. 2005) (“Specific language in a contract

91a controls over general language, and where specific and general provisions conflict, the specific provision ordinarily qualifies the meaning of the general one.”)). To reach this conclusion, the majority finds a false conflict between the qualitative definition of Patent Rights in Section 1.07 and the reference to Schedule A. As discussed above, the “loss of rights” clause describes one category of patents that are excluded from transfer, and Schedule A is merely a document intended to accurately list the transferred Patent Rights. Schedule A’s “quite specific” listing and Section 1.07’s “broad exclusionary definition” co-exist without conflict because the definition governs the transfer in the event of any inconsistency between the definition and Schedule A.

Again, it is impermissible for the majority to treat the entire definition of Patent Rights as superfluous, and thereby decline to interpret its language. Osborn, 991 A.2d at 1159. The effect of the “loss of rights” clause in particular is a critical disputed issue in this case that begs the question as to its meaning. In order to “read the instrument as a whole, and, if possible, reconcile all the provisions of the instrument,” the “loss of rights” clause must be interpreted, for it is a key component of the agreement. Elliot Assocs. v. Avatex Corp., 715 A.2d 843, 854 (Del. 1998).

The phrase “loss of rights” is not defined in the Con-tribution Agreement, nor it is used anywhere other than in Section 1.07. Nevertheless, it is clear that this “loss of rights” language cannot mean what it says on its face because no patent can be transferred without a loss of some rights by the transferor. Contrary to Dow’s assertions, there is nothing in the agreement suggesting that the “loss of rights” clause contem-plated the right to recover lost profits in litigation. In

92a contrast with the rights relating to the payable royalties expressly mentioned in Section 1.07, lost profits are not mentioned in the Contribution Agreement, nor is the word “litigation” used. The context in which the loss of rights clause appears—i.e., being listed third in a sentence after two other exceptions involving third party rights and obligations under the patents, including those relating to royalties—is unhelpful because “loss of rights” is in no way tied to the other exceptions. The overall objective of the Contribution Agreement to transfer patents to DGTI for licensing back to Dow does not assist us in deciding to what extent the clause implicates litigation standing or substantive remedial rights. Even the majority agrees that the parties’ best attempts to give meaning to the “loss of rights” phrase have no discernible basis in the four corners of the agreement. Maj. Op. at 7 (“Neither one of [the parties’] theories is anchored in the text of the Contribution Agreement.”). As such, the phrase “loss of rights” is ambiguous as used in the Contribution Agreement and Delaware law requires examination of the extrinsic evidence to resolve the ambiguity. AT&T Corp., 953 A.2d at 253. While the district court and the majority both erro-neously fail to undertake this analysis, I will now address the pertinent extrinsic evidence bearing on the meaning of “loss of rights.”2

2 Under these circumstances, whereby in our de novo review I

would reverse the district court and find ambiguity, this court has the authority to fully delve into the extrinsic evidence to resolve the ambiguity, rather than remand to the district court for further fact finding. See Metric Constructors, Inc. v. NASA, 169 F.3d 747, 749, 753-54 (Fed. Cir. 1999) (reversing Board decision where evidence of trade practice, custom, and the parties’ conduct was given “no weight ‘in light of the clear words’ of the contract,” and resolving the ambiguity without remand).

93a 1. Contemporaneous Communications

Under Delaware law, outside the express terms of an agreement, communications and documentation made contemporaneously with the agreement are the best extrinsic evidence of the parties’ intent. See Hudak v. Procek, 806 A.2d 140, 148 (Del. 2002) (explaining that absent contemporaneous documenta-tion, parties may generally offer two types of evidence to prove intent: testimony concerning their intent or post-transaction conduct). This case presents an instance in which there are documents in the record that were contemporaneously prepared by the parties to the Contribution Agreement, and which explicitly discuss their reasoning for including the disputed “loss of rights” term. Importantly, these discussions address the effect the transfer of Patent Rights would have on Dow’s standing to assert patents in litigation.

On January 27, 2002, shortly before the Contribu-tion Agreement was signed,3 Dow’s Managing Patent

Because the district court found the Contribution Agreement

to be unambiguous, it did not engage in a thorough discussion of the extrinsic evidence. Nevertheless, while the district court made clear that it did consider such evidence, it determined that it ultimately was “not persuaded” that the extrinsic evidence should change the result. Standing Op. at 461, 463. Despite also deeming the Contribution Agreement unambiguous, the majority analyzes extrinsic evidence alleged to support its conclusion, such as testimony from Dow’s paralegal Kathleen Maxwell on the issue of the accuracy and authenticity of the Schedule B Supplement in evidence. These internally contradictory approaches of the district court and the majority belie their findings that there is no ambiguity concerning the Contribution Agreement and Schedule A.

3 Although the Contribution Agreement was effective January 1, 2002, it was not actually signed by Dow and DGTI until February 17 and 7, 2002, respectively.

94a Counsel Mr. Bruce Kanuch sent an email posing the following question about the Contribution Agree-ment’s effect on Dow’s then-pending litigations:

Did transfer of all patents into this new company have any provisions on how to handle pending litigations under Dow patents . . . . It is a question of who had standing and who is the real party in interest in these litigations.

A5664 (emphasis added). Other in-house counsel ex-plained that standing for future potential litigations, such as in this case, could be easily addressed by the PTLA’s provisions for re-assignment of patents to Dow, but that pending litigations were not specifically addressed by the Contribution Agreement:

The Patent and Technology License Agreement, which also will be executed shortly, makes provi-sion for DGTI to convey rights to bring suit under patents even after these are contributed, but no specific mention was made of the current litiga-tions.

A5663. Mr. Kanuch then elaborated on his standing concerns, observing that while licensing arrangements can in some circumstances impart licensees with standing, it was generally easier to just sue in the name of the owner/licensor. He therefore proposed that it would be best for patents involved in pending litigation to remain with Dow and not be transferred to DGTI:

The issue is primarily one of legal standing to bring and/or maintain the lawsuit. Normally an exclusive license must include an essentially com-plete transfer of all rights under the patent in or-der for the licensee to have standing to bring the suit in its own name without adding the patent

95a owner. If not the court’s fear is that the patent owner could later bring a second suit. It would be cleaner to have title stay with TDCC or transfer the patent and bring suit in the name of Dow Tech, Inc. For the suits that are already pending it would make it simpler to have the patents just remain with Dow.

Id. (emphasis added). Dow’s in-house counsel agreed with Mr. Kanuch’s proposal and explained that she added a “loss of rights” provision to address his concern:

Thank you for the feedback. I’ve addressed this issue in the contribution agreement by excluding patents that can’t be transferred to DGTI without a loss of rights (previously, it excluded patents that can’t be transferred to DGTI without a loss of patent protection). As an overall safety net, there is a schedule of excluded intangible assets, just in case there may be other instances in which we de-termine that there would be some disadvantage in transferring the assets to DGTI.

Id. (emphasis added). In an abundance of caution, other in-house counsel responded with a proposal to schedule the patents that were involved in pending lawsuits:

It is desirable to avoid any ambiguity with regard to TDCC’s rights to continue the suits. I recom-mend that we schedule the patents involved in these litigations to affirm these are not contrib-uted to [Dow Global] for the duration of the litiga-tion.

A5662 (emphasis added). Finally, Dow’s paralegal re-sponded with an email attaching “a listing of Dow’s patents involved in litigation on Jan. 1, 2002.” A5662.

96a These emails show that Dow and DGTI were con-

cerned with losing standing in pending litigations by transferring the asserted patents to DGTI in the middle of the case. The solution to the problem in their minds was the loss of rights clause, which operated to preclude transfer of patents involved in pending cases that had been brought in Dow’s name only. To remove any doubt, they even scheduled a list of patents involved in litigations pending on January 1, 2002, which were supposedly not to be transferred. Future cases were not perceived as problematic from a standing perspective since such cases could simply be brought by DGTI or, upon Dow’s request, DGTI could transfer patents back to Dow. In any event, the focus of these contemporaneous communications concerning the loss of rights provision was solely on the issue of legal standing. Notably absent from these emails is any mention of lost profits, which is reasonable since the right to collect lost profits has no bearing on Dow’s ability to “bring and/or maintain . . . lawsuit[s].” A5663.

These contemporaneous communications show that “loss of rights” in Section 1.07 was meant to address the loss of ownership rights that would eliminate Dow’s standing in any litigations pending as of January 1, 2002. Since the patents-in-suit were not asserted against NOVA until 2005, they were not excepted from transfer under the “loss of rights” clause, and as such were transferred to DGTI under the Contribution Agreement.

C. Other Extrinsic Evidence

Other extrinsic evidence offered by the parties regarding transfer and/or the meaning of the “loss of rights” clause comprises Dow’s and DGTI’s post-execution conduct, primarily with respect to the

97a contents of Schedules A and D. In brief, I find this additional evidence is not persuasive to overcome the express language of the agreements or the clear evidence as to the meaning of “loss of rights.”

1. The Schedule B Supplement

First, the parties argue whether the presence or ab-sence of the patents-in-suit on Schedule A to the Contribution Agreement reflect an intention of Dow and DGTI to exclude the patents-in-suit from transfer under the loss of rights clause. While I conclude that the district court did not clearly err in finding that Dow’s Schedule B Supplement was in fact intended to be Schedule A, and that this version of Schedule A did not list the patents-in-suit, as discussed above, Schedule A does not control what was or was not transferred. Whether the patents-in-suit were listed on Schedule A also has little to no bearing on what the operative language “loss of rights” means.

To the extent the Schedule B Supplement lists what Dow and DGTI thought was transferred to DGTI under the Contribution Agreement, I note that no version of Schedule A in the record was prepared contemporaneously with the Contribution Agreement. The only version of Schedule A before us that listed any patents was dated December 15, 2005, far removed from the effective date of the Contribution Agreement (January 1, 2002) and therefore of very limited probative value regarding the parties’ intent in 2002. Moreover, because this Schedule A was dated nearly a month after the complaint was filed (October 21, 2005), and because Dow did not introduce evidence or testimony to show what changes were made to the document prior to December 15, 2005, there is no basis much less a preponderance of the evidence—to conclude that the patents-in-suit were not listed on

98a Schedule A when the lawsuit was initiated. Lastly, Dow contends that since the Schedule A in the record lists only four of Dow’s approximately 7,300 pre-2002 United States patents, U.S. patents in addition to those involved in pending litigation were excluded from transfer. Yet there is no evidence in the record that explains why those four U.S. patents in particular were the only ones listed. It strains credibility to suggest that only four U.S. patents were transferred by an agreement having such broad transferring language, particularly given the substantial antici-pated tax benefits that would accrue from a mass transfer of U.S. patents under Dow’s overall assign-ment and grant-back scheme.

The majority finds no basis to doubt the accuracy of the October 21, 2005 Schedule A in terms of reflecting ownership of the patents-in-suit when this lawsuit was filed. Despite finding the Contribution Agreement unambiguous and requiring no inquiry into extrinsic evidence, the majority selectively points to the extrinsic testimony of Dow’s paralegal Kathleen Maxwell to suggest that no version of Schedule A ever listed the patents-in-suit so as to effectuate their transfer to DGTI. The majority points out that Schedule A was originally created in 2002 by Ms. Maxwell from Dow’s internal database listing of patents owned by DGTI. However, this proves nothing as to the effect of the Contribution Agreement on Dow’s patent portfolio ownership because Ms. Maxwell, who testified that she was responsible for managing the database, also testified that she had not updated the database in 2002 to reflect the Contribution Agreement. Likewise, Ms. Maxwell’s testimony does not explain which patents were added or removed from the database over time, or why such changes were made, in relation to subsequent updates

99a to Schedule A leading up to the December 15, 2005 version in evidence. Ms. Maxwell’s only means of verifying that the patents-in-suit were not listed on Schedule A currently was to query Dow’s new internal database which the evidence shows was only in use since 2009, long after the Contribution Agreement’s execution and the filing of the present lawsuit. Regardless of the “virtually unassailable” credibility of Ms. Maxwell with respect to the statements cited by the majority, those statements tell only part of the story and were controverted by other testimony. This weak and inconclusive testimony as to the contents of Schedule A over time, particularly in light of the absence of any documentary evidence as to Dow’s internal database or Schedule A prior to October 21, 2005, calls into question which patents, if any, were listed on any version of Schedule A that existed prior to the filing of this lawsuit.

The Schedule A in the record simply does not help Dow carry its burden to prove by a preponderance of the evidence that the patents-in-suit were owned by Dow when it initiated this lawsuit, nor does it provide any guidance as to what was meant by “loss of rights” in 2002.

2. Schedule D

Second, the parties argue whether Schedule D to the Contribution Agreement, which provides a listing of “Excluded Intangible Assets,” indicates that the patentsin-suit were transferred. Schedule D was prepared by Dow and DGTI within the 90 day period specified under the Contribution Agreement and, unlike the Schedule B Supplement, was therefore contemporaneously created with the Contribution Agreement. Delaware law treats such contemporane-ous documentation as more probative of intent than

100a later-created evidence or testimony. See Hudak, 806 A.2d at 148 (emphasizing that evidence “at the time of the transaction” is most probative of the contem-poraneous understanding of an agreement). The contemporaneously prepared Schedule D did not list the patents-in-suit, but a later version of Schedule D updated by Dow in 2009 in response to Nova’s discovery requests did list the patents-in-suit. NOVA argues that the absence of the patents-in-suit on the original Schedule D indicates that the patents-in-suit were in fact transferred. NOVA also contends that the later updated version of Schedule D which included the patents-in-suit was essentially a litigation-induced fabrication to make it appear as if the patents-in-suit had not been transferred in 2002.

While Dow’s counsel understood Schedule D as “an overall safety net” useful to avoid disadvantageous transfers, A5663, the Contribution Agreement is not clear as to how Schedule D relates to the definition of Patent Rights in Section 1.07, if at all. Neither Schedule D nor the “Excluded Intangible Assets” are referenced anywhere in connection with the trans-ferred Patent Rights. To the extent Schedule D was intended to list patents that were not transferred, the version of Schedule D prepared contemporaneously with the Contribution Agreement did not list the patents-in-suit, and this fact should not be disregarded. See Hudak, 806 A.2d at 148.

Even if the presence of a patent on Schedule D ex-cluded it from transfer for some reason, the inverse is not necessarily true. Because the schedules to the Contribution Agreement are not controlling, a patent not listed on Schedule D could still be excluded from transfer under one or more of the exceptions in Section 1.07. Thus, Schedule D alone cannot reveal why any

101a given patents were listed as Excluded Intangible Assets, and the absence of the patents-in-suit from the original Schedule D could have been for any number of reasons. To the extent Dow argues that there are generally more U.S. patents listed on Schedule D than were involved in active litigation in 2002—which could arguably support its “lost profits” theory—I see no evidence in the record to support this statement or explain why the particular U.S. patents listed on Schedule D were excluded from transfer, and I see no need to engage in further analysis of this assertion. See Gemtron Corp. v. Saint-Gobain Corp., 572 F.3d 1371, 1380 (Fed. Cir. 2009) (emphasizing that “unsworn attorney argument . . . is not evidence”). I therefore find the parties’ arguments regarding Schedule D to be unpersuasive, and unhelpful in discerning what “loss of rights” means.

3. USPTO Assignment Records and Maintenance Fees

Third, the parties point to other purportedly objective indications of ownership of the patents-in-suit. For example, Dow notes that Dow and DGTI filed assignment documents with the U.S. Patent and Trademark Office (“USPTO”) to record the transfer of ownership for many patents to DGTI, but did not do so for the patents-in-suit. NOVA counters that DGTI, not Dow, bore the cost of the maintenance fees paid to the USPTO for the patents-in-suit from 2004 to the present. Dow’s chief IP counsel conceded that typically it is the owner of a patent who pays the maintenance fees. Despite that this conflicting post-execution conduct is at best ambiguous as to whether the patents-in-suit were conveyed by Dow to DGTI, the majority finds the 1990s assignment records at the USPTO persuasive to suggest that Dow is in fact the

102a proper owner of the patents-in-suit. The assignment records merely create a presumption of ownership, however, and are not dispositive. See SiRF Tech., Inc. v. Int’l Trade Comm’n, 601 F.3d 1319, 1327-28 (Fed. Cir. 2010). In this case, subsequent to the USPTO assignment records are the Contribution Agreement and the Quitclaim Deed showing Dow’s transfer and reacquisition of the patents-in-suit. Rather than relying on an absence of a future recorded assignment to show that Dow still owns the patents-in-suit, as the majority does, I find the evidence in the record of actual subsequent assignment documents more persuasive to show which entity held title to the patents-in-suit when this litigation commenced.

4. Patent Royalty Payments

Lastly, NOVA contends that Dow’s royalty pay-ments to DGTI and corresponding tax benefits indicate that Dow transferred the patents to DGTI. Otherwise, according NOVA, Dow has taken a position so as to have its cake and eat it too—to own the patents for purposes of standing but not for purposes of royalties and taxation. While the record is not clear as to how much of the royalty payments are attributable of the ’023 patent, Dow has not shown that the payments were made solely in exchange for rights to intellectual property other than the patents-in-suit. Dow concedes that it received tax benefits, and the PTLA as a whole strongly suggests that the royalties owed to DGTI relate at least in part to the ’023 patent (i.e., to Dow’s ELITE product line), but Dow presented no evidence to apportion out the royalty payments that gave rise to its tax benefits. Only Dow would have this information. This failure of proof by Dow tends to suggest that the ’023 patent was transferred to DGTI. Again, Dow bears the burden to establish standing,

103a and this glaring contradiction between the overarch-ing goal of the agreements and Dow’s assertion that the patents-in-suit were somehow not part of the transfer and grant-back scheme highlights Dow’s failure to carry its burden. Land-Lock, 963 A.2d 139 (explaining that contracts should not interpreted by making “inference[s] run[ning] counter to the agreement’s overall scheme or plan”).

* * *

In sum, I find that the Contribution Agreement, when read in light of all the extrinsic evidence, shows that the patents-in-suit were transferred to DGTI as of January 1, 2002.

III. DISMISSAL WITH PREJUDICE IS UNWAR-RANTED

The law “universally disfavors dismissing an action with prejudice based on lack of standing,” and I see no compelling reason to so do as a sanction in this case. Univ. of Pittsburgh v. Varian Med. Sys., Inc., 569 F.3d 1328, 1332-33 (Fed.Cir. 2009). Dismissal without prejudice tends to be appropriate where, as here, the plaintiff is able to cure (and indeed already has cured via the Quitclaim Deed) the standing problem. See Tyco, 587 F.3d at 1380 (affirming dismissal without prejudice in part because “[a]s best we can tell, Tyco Healthcare may become able to show that it owned the asserted patents. Alternatively, Tyco Healthcare may be able to obtain ownership of the patents.”); Sicom Sys. v. Agilent Techs., Inc., 427 F.3d 971, 980 (Fed. Cir. 2005) (affirming dismissal with prejudice where plaintiff “already had a chance to cure the [standing] defect and failed”); Fieldturf, Inc. v. Southwest Rec. Indus., 357 F.3d 1266, 1269 (Fed. Cir. 2004) (“On occasion, . . . a dismissal with prejudice is appropriate,

104a especially where ‘it [is] plainly unlikely that the plaintiff [will be] able to cure the standing problem.’”) (citations omitted).

NOVA argues that Dow failed to perform a sufficient pre-filing investigation, failed to provide timely and adequate discovery on standing issues, and produced schedules of questionable authenticity and accuracy, all of which “wasted untold time and money on an infringement case that should never have been brought or should promptly have been dismissed.” NOVA Br. at 56. Essentially, NOVA argues that Dow has engaged in the kind of conduct that warrants a dismissal with prejudice as a sanction. In support of its argument, NOVA cites Lans v. Digital Equip. Corp., in which this court affirmed a district court’s dismissal with prejudice where the plaintiff “pur-ported to own a patent he did not actually own . . . did not disclose the actual owner until the [Defendants] discovered the assignment . . . , and even then he equivocated.” 252 F.3d 1320, 1328-29 (Fed. Cir. 2001). The plaintiff in Lans, however, could not re-file because the patent had expired and he could not recover past damages under 35 U.S.C. § 287. Id. at 1328. Moreover, there was no dispute that the plaintiff in Lans had actually assigned away the patent to another entity before misrepresenting that he still owned the patent. Rather, the plaintiff alleged that he “had simply forgotten about the assignment,” but the district court found this allegation of an honest mistake was not credible. Id. at 1324-25. While dismissal with prejudice was appropriate in that case, this court has been appropriately reluctant to sanction parties with a dismissal with prejudice. See Univ. of Pittsburgh, 569 F.3d at 1333-34 (reversing dismissal with prejudice despite district court’s specific findings of “untimely and unfair” conduct in choosing not to join

105a a necessary party for “tactical” reasons, as well as “undue delay” via failure to abide by scheduling orders). I would decline to impose such a harsh penalty on Dow based on the record before us in this case.

IV. CONCLUSION

I believe that law schools still teach first year law students that whether standing exists should always be one of the first questions considered when a lawsuit is likely to be filed. When a genuine question of standing is presented, its resolution should not be delayed by the parties or by the court, as every day spent in a litigation brought without standing is wasteful. Counsel, as fiduciaries to their clients and officers of the court, are obligated to diligently work to prevent such unnecessary burdens on the justice system.

106a APPENDIX D

Only the Westlaw citation is currently available. 2010 WL 3056617

————


————

Civil Action No. 05–737–JJF

————

The DOW CHEMICAL COMPANY,

Plaintiff, v.

NOVA CHEMICALS CORPORATION (CANADA), and NOVA Chemicals Inc. (Delaware),


July 30, 2010

————


Harry J. Roper, Esquire; Aaron A. Barlow, Esquire and Paul D. Margolis Esquire of Jenner & Block LLP, Chicago, IL, Raymond Nimrod, Esquire and Gregory D. Bonifield, Esquire of Jenner & Block LLP, New York, NY, Rodger D. Smith II, Esquire and Andrew C. Mayo, Esquire of Morris, Nichols, Arsht & Tunnel LLP, Wilmington, DE, for Plaintiff The Dow Chemical Company.

Ford F. Farabow, Jr., Esquire; Ronald A. Bleeker, Esquire; Joann M. Neth, Esquire; Martin I. Fuchs,

107a Esquire; Mark J. Feldstein, Esquire; Jeffrey W. Abraham, Esquire; Troy A. Petersen, Esquire and Ken Motolenich–Salas, Esquire of Finnegan, Henderson, Farabow, Garrett & Dunner, L.L.P., Washington, D.C., H. Woodruff Turner, Esquire; Thomas A. Donovan, Esquire; Robert D. Yeager, Esquire and Brian P. Anderson, Esquire of Kirkpatrick & Lockhart Preston Gates Ellis LLP, Pittsburgh, PA, Richard L. Horwitz, Esquire; David E. Moore, Esquire and D. Fon Muttamara–Walker, Esquire of Potter Anderson & Corroon LLP, Wilmington, DE, for Defendants NOVA Chemicals Corporation (Canada) and Nova Chemicals Inc. (Delaware).

MEMORANDUM OPINION

FARNAN, District Judge.

Pending before the Court are three Motions filed by Defendant Nova Chemicals Corporation (Canada) and Nova Chemicals Inc.’s (Delaware) (collectively “Nova”): (1) a Renewed Motion For Judgment As A Matter Of Law On The Issue Of Invalidity Under 35 U.S.C. § 112 Pursuant To Fed.R.Civ.P. 50 Or, In The Alternative, For A New Trial

Under Fed.R.Civ.P. 59 (D.I.553); (2) a Renewed Motion for Judgment as a Matter of Law under Fed.R.Civ.P. 50 That Plaintiff Is Not Entitled to Lost Profits, Limiting Award to Reasonable Royalty Damages And, in the Alternative, for a New Trial under Fed.R.Civ.P. 59 (D.I.554); and (3) a Renewed Motion for Judgment as a Matter of Law on the Issue of Non-infringement under Fed.R.Civ.P. 50 Or, in the Alternative, for a New Trial under Fed.R.Civ.P. 59

108a (D.I.555).1 For the reasons discussed, the Court will deny Nova’s Motions.

BACKGROUND

Dow initiated this action against Nova asserting that Nova infringed United States Patent Nos. 5,847,053 (“the ‘053 patent”) and 6,111,023 (“the ‘023 patent”), owned by Dow. The patents-in-suit relate to polymer compositions, specifically polyethylene. The Court conducted a jury trial between May 27, 2010 and June 15, 2010, and the jury returned a verdict in favor of Dow in the amount of $61,770,994.60, representing lost profits and reasonable royalty damages. (D.I.525.) Following the conclusion of the jury trial, a one-day bench trial was held on the issue of Dow’s standing.2 Thereafter, Nova renewed its Motions For Judgment As A Matter Of Law.

STANDARD OF REVIEW

I. Motions For Judgment As A Matter Of Law

Pursuant to Rule 50 of the Federal Rules of Civil Procedure, a court may grant judgment as a matter of law if “the court finds that a reasonable jury would not have a legally sufficient evidentiary basis” to find for a party on a given issue after that party has been fully heard. Fed.R.Civ.P. 50(a). To prevail on a renewed motion for judgment as a matter of law following a jury

1 Nova also filed two Motions For Judgment As A Matter Of

Law (D.I.500, 501) during trial. Because the issues raised by these Motions are encompassed by the Renewed Motions For Judgment As A Matter Of Law, the Court will deny the previously filed Motions For Judgment As A Matter Of Law as moot.

2 The Court has addressed the standing issue by separate Memorandum Opinion.

109a trial, the moving party “‘must show that the jury’s findings, presumed or express are not supported by substantial evidence or, if they were, that the legal conclusions implied [by] the jury’s verdict cannot in law be supported by those findings.’” Pannu v. Iolab Corp., 155 F.3d 1344, 1348 (Fed.Cir.1998) (quoting Perkin–Elmer Corp. v. Computervision Corp., 732 F.2d 888, 893 (Fed.Cir.1984)). In determining whether sufficient evidence was presented to support a jury verdict, a court must give the non-moving party, “as verdict winner, the benefit of all logical inferences that could be drawn from the evidence presented, resolve all conflicts in the evidence in his favor and, in general, view the record in the light most favorable to him.” Williamson v. Consol. Rail Corp., 926 F.2d 1344, 1348 (3d Cir.1991).

The court may not weigh the evidence, evaluate the credibility of the witnesses, or substitute its own version of the facts for the jury’s findings. Marra v. Phila. Hous. Auth., 497 F.3d 286, 300 (3d Cir.2007). Rather, the court must determine whether the evidence reasonably supports the jury’s verdict. Dawn Equip. Co. v. Kentucky Farms, Inc., 140 F.3d 1009, 1014 (Fed.Cir.1998). Although a court should grant judgment as a matter of law sparingly, it is appropriate where only a “scintilla of evidence” supports the verdict, or where “the record is critically deficient of the minimum quantum of evidence” needed to support the verdict. Johnson v. Campbell, 332 F.3d 199, 204 (3d Cir.2003) (citing Gomez v. Allegheny Health Servs., Inc., 71 F.3d 1079, 1083 (3d Cir.1995)).

110a II. Motions For A New Trial

In pertinent part, Federal Rule of Civil Procedure 59(a) provides:

A new trial may be granted to all or any of the parties and on all or part of the issues in an action in which there has been a trial by jury, for any of the reasons for which new trials have heretofore been granted in actions at law in the courts of the United States.

Fed.R.Civ.P. 59(a). Among the most common reasons for granting a new trial are the following: (1) the jury’s verdict is against the clear weight of the evidence, and a new trial must be granted to prevent a miscarriage of justice; (2) newly discovered evidence exists that would likely alter the outcome of the trial; (3) improper conduct by an attorney or the court unfairly influenced the verdict; or (4) the jury’s verdict was facially inconsistent. Zarow–Smith v. New Jersey Transit Rail Operations, 953 F.Supp. 581, 584 (D.N.J.1997) (citations omitted).

The decision to grant or deny a new trial is committed to the sound discretion of the district court. Allied Chemical Corp. v. Darflon, Inc., 449 U.S. 33, 36, 101 S.Ct. 188, 66 L.Ed.2d 193 (1980); Olefins Trading, Inc. v. Han Yang Chem Corp., 9 F.3d 282 (1993) (reviewing district court’s grant or denial of new trial motion under deferential “abuse of discretion” standard). However, where the ground for a new trial is that the jury’s verdict was against the great weight of the evidence, the court should proceed cautiously, because such a ruling would necessarily substitute the court’s judgment for that of the jury. Klein v. Hollings, 992 F.2d 1285, 1290 (3d Cir.1993). Although the standard for grant of a new trial is less rigorous than

111a the standard for grant of judgment as a matter of law in that the court need not view the evidence in the light most favorable to the verdict winner, a new trial should only be granted where “a miscarriage of justice would result if the verdict were to stand,” the verdict “cries out to be overturned,” or where the verdict “shocks our conscience.” Williamson, 926 F.2d at 1352; see also Price, 40 F.Supp.2d at 550.

Where a motion for a new trial is based on an alleged legal error in the jury instructions, the court must determine “whether an error was in fact committed, and (2) whether that error was so prejudicial that [the] denial of a new trial would be inconsistent with substantial justice.” Lafate v. Chase Manhattan Bank (USA), 123 F.Supp.2d 773, 785 (D.Del.2000) (citations omitted). In making these determinations, the court should examine the jury instructions as a whole and should not scrutinize specific instructions in a vacuum. Id. Overall, the jury instructions must fairly and adequately apprise the jury of the issues and the applicable law. Tigg Corp. v. Dow Corning, Corp., 962 F.2d 1119, 1123 (3d Cir.1992).

Where a new trial is sought on the basis of the improper admission or exclusion of evidence, the Court applies the harmless error standard of Fed.R.Civ.P. 61:

No error in either the admission or the exclusion of evidence and no error or defect in any ruling or order or in anything done or omitted by the court or by any of the parties is ground for granting a new trial or for setting aside a verdict or for vacating, modifying, or otherwise disturbing a judgment or order, unless refusal to take such action appears to the court inconsistent with substantial justice. The court at every stage of the

112a proceeding must disregard any error or defect in the proceeding which does not affect the substantial rights of the parties.

Becker v. Arco Chem. Co., 207 F.3d 176, 180 (3d Cir. 2000).

DISCUSSION

I. Nova’s Renewed Motion For Judgment As A Matter Of Law On The Issue Of Invalidity Under 35 U.S.C. § 112 Or, In The Alternative, For A New Trial

By its Motion, Nova contends that the patents-in-suit are invalid for lack of written description under 35 U.S.C. § 112. Specifically, Nova contends that the patents-in-suit lack the information needed to define the “SHC” limitation, such as the type of curve needed, the units to use, and the location of the “parallel line.” As a result of these omissions, Nova contends that the public is unable to practice the claimed invention, and therefore, the patents-in-suit are invalid as a matter of law. Alternatively, Nova contends that it is entitled to a new trial based on errors in the jury instruction concerning Section 112.

Reviewing the evidence presented at trial in the light most favorable to Dow, as the verdict winner, the Court concludes that sufficient evidence was pre-sented to support the jury’s verdict that the patents-in-suit are not invalid. Dow presented extensive testimony from its expert, Dr. Hsiao, and the jury’s verdict indicates that the jury found Dr. Hsiao to be more credible than Dr. Fuller. In reviewing Dr. Hsiao’s opinion, the Court finds more than ample evidentiary support for the jury’s verdict. Accordingly, the Court will deny Nova’s Motion For Judgment As A Matter Of Law on invalidity.

113a To the extent Nova requests a new trial based on an

error in the jury instructions, the Court concludes that its instructions were not erroneous. The jury instruction given on invalidity under Section 112 is consistent with the Federal Circuit’s decision in Ariad Pharms., Inc. v. Eli Lilly & Co., 598 F.3d 1336 (Fed.Cir.2010). Accordingly, the Court will deny Nova’s Motion to the extent that it seeks a new trial.

II. Nova’s Renewed Motion for Judgment as a Matter of Law On Lost Profits And Reasonable Royalty Damages, Or In The Alternative, For A New Trial

Nova next contends that insufficient evidence was presented to support the jury’s verdict that Dow was entitled to lost profits damages. According to Nova, the jury should have limited damages to a reasonable royalty rate because Dow failed to establish that lost profits were warranted under the standard set forth in Panduit Corp. v. Stahlin Bros. Fibre Works, Inc., 575, 1152, 1156 (6th Cir.1978).

After reviewing the evidence presented at trial in the light most favorable to Dow, the Court concludes that sufficient evidence was presented to support the jury’s conclusion that Dow was entitled to lost profits. To establish an entitlement to lost profits under the Panduit test adopted by the Federal Circuit, a plaintiff must prove: (1) demand for the patented product; (2) absence of acceptable non-infringing substitutes; (3) manufacturing and marketing capability to exploit the demand; and (4) the amount of the profit it would have made. Id. Nova contends that there are multiple non-infringing alternatives to Dow’s Elite product, how-ever, the Court is persuaded that the evidence presented at trial sufficiently establishes that none of

114a the marketed products had the same high perfor-mance properties as the Dow Elite product. (See e.g., D.I. 580 at 33–34 (Trial Tr. Vol. 8.) In addition, Nova contends that Dow’s evidence concerning the amount of profit it would have made is speculative. In the Court’s view, however, Dow presented sufficient evidence of the amount of profit it would have made absent Nova’s infringement. Dow’s expert on the polyethylene market, Mr. Hoffman, testified that Dow would have obtained 80 percent of Nova’s Surpass product sales, in the absence of the Surpass product being on the market. (See e.g., D.I. 580 at 121–124 (Trial Tr. Vol. 8.) The jury was entitled to credit Mr. Hoffman’s testimony, and the Court finds Mr. Hoffman’s testimony and the related evidence on lost profits to be sufficient to support the jury’s lost profit award. Accordingly, the Court will deny Nova’s Motion For Judgment As A Matter Of Law.

As for Nova’s request for a new trial, Nova contends that the great weight of the evidence demonstrates that the written description and definition for the SHC limitation in the patentsin-suit are “fundamentally defective.” (D.I. 553 at 20.) In addition, Nova chal-lenges the Court’s jury instruction on written description and indefiniteness contending that (1) the written description instruction was prejudicial be-cause it did not give a “four corners” instruction and did not limit the use of supporting extrinsic material; and 2) the indefiniteness instruction was prejudicial because it excused the absence of test conditions necessary for calculating SHC values.

Even without the benefit of drawing reasonable inferences in favor of Dow, the Court concludes that the jury’s findings on lost profits are not against the great weight of the evidence, and that no miscarriage

115a of justice results from the jury’s verdict. Further, the Court is not persuaded that either the written description or indefiniteness instructions contained legal errors, and therefore, the Court cannot conclude that Nova was prejudiced by either instruction. Accordingly, the Court will deny Nova’s request for a new trial.

III. Nova’s Renewed Motion For Judgment As A Matter Of Law On Non-infringement Or, In The Alternative, For A New Trial

By its Renewed Motion For Judgment As A Matter Of Law On Non-infringement, Nova contends that no reasonable jury could have found that the accused Nova products contain the following elements of the asserted claims: (1) Component B; (2) Component A, (3) Component A with a SHC of greater than or equal to 1.3, and (4) Component A having the required SHC in metric units of kilograms and millimeters. In addition, Nova contends that no reasonable jury could have found that Nova’s XJS Resins Infringe the ’053 and ’023 patents. Further, Nova maintains that no reasonable jury could have found that Component A of the asserted claims was present in the accused products that were sold in the United States. Alternatively, Nova contends that a new trial is warranted because (1) the Court should have included Nova’s proposed jury instruction 3.6, which required Dow to prove that Components A and B were present together in Nova’s products sold in the United States, and (2) Dow’s expert, Dr. Soares, improperly testified on cross-fractionation, which was beyond the scope of his expert report. (Id.)

After reviewing the evidence adduced at trial in the light most favorable to Dow, the Court concludes that sufficient evidence supports the jury’s verdict that

116a Nova infringes the patents-in-suit. The testimony of Dr. Soares and Dr. Hsiao both were sufficient to support a finding of infringement, and the jury was entitled to credit the testimony of these experts.

To the extent Nova contends that a new trial is warranted, the Court concludes that its jury instructions on patent infringement were not erroneous, and Nova’s proposed instruction was not warranted. Specifically Jury Instruction 3.3 (Patent Infringement—Direct) explained that to find infringe-ment, the jury must conclude that the offending action took place within the United States. (D.I. 521 at 19.) In light of this instruction, the Court concludes that Nova’s proposed instruction would have been redun-dant, and therefore, the Court cannot conclude that Nova was prejudiced by the Court’s decision to exclude Nova’s proposed jury instruction.

In addition, the Court cannot conclude that Nova was prejudiced by the testimony of Dr. Soares on cross-fractionation. Dr. Soares testified at his deposition that he used the crossfractionation testing in PTX–300 “to realize that this product is not uniform, very clearly heterogeneously branched.” (D.I. 571 Ex. A (Soares Dep. 342).) PTX 300 contained materials cited in Dr. Soares expert report at Exhibit B, and therefore, the Court is not persuaded that Dr. Soares’ testimony impermissibly exceeded the scope of his expert report. Further, Dr. Soares comments on cross-fractionation followed testimony on cross-fractionation by Nova’s expert, Dr. Speed. (D.I. 582 at 246–248.) Because Dr. Soares’ testimony was a proper response to the testimony of Nova’s expert and because his testimony was consistent with and a permissible elaboration on his deposition and expert report, the Court concludes that Dr. Soares’ testimony was properly admitted and

117a did not unduly prejudice Nova such that a new trial is warranted. Accordingly, the Court will deny Nova’s Motion to the extent it seeks a new trial.

CONCLUSION

For the reasons discussed, the Court will deny Nova’s Motions.

An appropriate Order will be entered.

ORDER

At Wilmington, this 30 day of July 2010, for the reasons set forth in the Memorandum Opinion issued this date;

IT IS HEREBY ORDERED that:

1. Defendants’ Renewed Motion For Judgment As A Matter Of Law On The Issue Of Invalidity Under 35 U.S.C. § 112 Pursuant To Fed.R.Civ.P. 50 Or, In The Alternative, For A New Trial Under Fed.R.Civ.P. 59 (D.I.553) is DENIED.

2. Defendants’ Renewed Motion For Judgment As A Matter Of Law Under Fed.R.Civ.P. 50 That Plaintiff Is Not Entitled To Lost Profits, Limiting Award To Reasonable Royalty Damages And, In the Alternative, For A New Trial (D.I.554) is DENIED.

3. Defendants’ Renewed Motion For Judgment As A Matter Of Law On The Issue Of Non–Infringement Under Fed.R.Civ.P. 50 Or, In The Alternative, For A New Trial Under Fed.R.Civ.P. 59 (D.I.555) is DENIED.

4. Defendants’ Motion For Judgment As A Matter Of Law On The Issue Of Non–Infringement (D.I.500) is DENIED as moot.

118a 5. Defendants’ Motion For Judgment As A Matter

Of Law That Plaintiff Is Not Entitled To Lost Profits (D.I.501) is DENIED as moot.

119a

APPENDIX E

2010 WL 3070189 Only the Westlaw citation is currently available.

————


————

Civil Action No. 05–737–JJF

————

The DOW CHEMICAL COMPANY,

Plaintiff, v.

NOVA CHEMICALS CORPORATION (Canada), and NOVA Chemicals Inc. (Delaware),


July 30, 2010

————


Harry J. Roper, Esq.; Aaron A. Barlow, Esq. and Paul D. Margolis Esq. of Jenner & Block LLP, Chicago, IL, Raymond Nimrod, Esq. and Gregory D. Bonifield, Esq. of Jenner & Block LLP, New York, NY, Rodger D. Smith II, Esq. and Andrew C. Mayo, Esq. of Morris, Nichols, Arsht & Tunnel LLP, Wilmington, DE, for Plaintiff The Dow Chemical Company.

Ford F. Farabow, Jr., Esq.; Ronald A. Bleeker, Esq.; Joann M. Neth, Esq.; Martin I. Fuchs, Esq.; Mark J. Feldstein, Esq.; Jeffrey W. Abraham, Esq.; Troy A. Petersen, Esq. and Ken Motolenich–Salas, Esq. of

120a

Finnegan, Henderson, Farabow, Garrett & Dunner, L.L.P., Washington, D.C., H. Woodruff Turner, Esq.; Thomas A. Donovan, Esq.; Robert D. Yeager, Esq. and Brian P. Anderson, Esq. of Kirkpatrick & Lockhart Preston Gates Ellis LLP, Pittsburgh, PA, Richard L. Horwitz, Esq.; David E. Moore, Esq. and D. Fon Muttamara–Walker, Esq. of Potter Anderson & Corroon LLP, Wilmington, DE, for Defendants Nova Chemicals Corporation (Canada) and Nova Chemicals Inc. (Delaware).

MEMORANDUM OPINION

FARNAN, District Judge.

Pending before the Court are a Motion For Summary Judgment Of Invalidity Based On Dow's “Slope Of Strain Hardening Coefficient” Limitation (D.I.254) filed by Defendants Nova Chemicals Corporation (Canada) and Nova Chemical Inc. (Delaware) (collectively “Defendants”), as well as a Motion For Summary Judgment That The Claims Of The ’053 And ’023 Patents Are Not Invalid For Lack Of Written Description (D.I.263) and a Motion For Partial Summary Judgment On Nova's New Written Description Defense Based On Dow's Slope Of Strain Hardening Coefficient” Limitation (D.I.291) filed by Plaintiff The Dow Chemical Company (“Plaintiff”). For the reasons discussed, the Motions have been denied (D.I.472).

I. LEGAL STANDARD ON SUMMARY JUDGMENT

In pertinent part, Rule 56(c) of the Federal Rules of Civil Procedure provides that a party is entitled to summary judgment if a court determines from its examination of “the pleadings, depositions, answers to interrogatories, and admissions on file, together with

121a

the affidavits, if any,” that there are no genuine issues of material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). In determining whether there is a triable dispute of material fact, a court must review all of the evidence and construe all inferences in the light most favorable to the non-moving party. Valhal Corp. v. Sullivan Assocs., Inc., 44 F.3d 195, 200 (3d Cir.1995).

To defeat a motion for summary judgment, the non-moving party must “do more than simply show that there is some metaphysical doubt as to the material facts.... In the language of the Rule, the non-moving party must come forward with specific facts showing that there is a genuine issue for trial.” Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586–87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (internal citations omitted). However, the mere existence of some evidence in support of the non-movant will not be sufficient to support a denial of a motion for summary judgment; there must be enough evidence to enable a jury to reasonably find for the non-movant on that issue. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Thus, if the evidence is “merely colorable, or is not significantly probative,” summary judgment may be granted. Id.

II. DISCUSSION

A. Indefiniteness

The Court concludes that Defendants are not entitled to summary judgment on the issue of indefiniteness. Defendants contend that evidence which arose after the Court's Claim Construction Order indicates that no question of material fact exists. While the new evidence regarding Plaintiff's

122a

expert witnesses is relevant, it is not dispositive. In the Court's view, many of the troubling questions regarding indefiniteness which were discussed in the Court's Claim Construction Memorandum Opinion (D.I. 270 at 7–21) remain, and require resolution by the jury on a full factual record. Accordingly, the Court has denied Defendants' Motion For Summary Judgment on indefiniteness.

B. Lack Of Written Description Defenses

1. Whether An Issue Of Material Fact Exists Regarding Written Support For SHC Units And Slope Location

Defendants contend that the patents-in-suit are invalid because they lack slope hardening coefficient units and an indication of slope location, and thus, do not “provide a description of the compound sufficient to distinguish infringing compounds from non-infringing compounds.” (D.I. 325 at 1.) Based on the current record, the Court is persuaded that a reasonable jury could find that units and slope location are necessary to determine whether the accused infringing product actually infringes the patents-in-suit. Further, as discussed supra and in the Court's Claim Construction Memorandum Opinion, the Court concludes that material mixed questions of fact and law remain as to whether the questioned slope of strain hardening coefficient units and slope location are described in the patent. Accordingly, to the extent Plaintiff and Defendants both seek summary judgment on this basis, the Court has denied the Motions.

123a

2. Whether Plaintiff Is Entitled To Summary Judgment On The Existence Of An Adequate Written Description

By its Motion, Plaintiff contends that if a claim limitation is recited verbatim in the patent, there can be no lack of written description. (D.I. 326 at 1.) The Court concludes that a verbatim recitation does not necessarily provide an adequate written description of a claim, see Enzo Biochem, Inc. v. GenProbe Inc., 323 F.3d 956, 968 (Fed.Cir.2002), and therefore, Plaintiff is not entitled to summary judgment on this basis.

With regard to the value of the slope hardening coefficient, Plaintiff further contends that there is no requirement that all possible values in a range be explicitly discussed to satisfy a written description requirement. (D.I.326.) Viewing the evidence in the light most favorable to Defendants, as the nonmovants, the Court concludes that a reasonable jury could determine that the actual density range is not adequately described by the patent; some evidence indicates a maximum strain of slope hardening coefficient value at 2.3, while the claim language leaves the range without an upper limit. Accordingly, the Court concludes that genuine issues of material fact exist which preclude summary judgment.

In addition, with regard to the “linear” and “substantially linear” species, Plaintiff contends that both species are specifically claimed in the patents-in-suit. Viewing the evidence in the light most favorable to Defendants, the Court concludes that a reasonable jury could find that the patents-in-suit do not adequately describe the totality of the invention; some evidence exits regarding differences between “linear” and “substantially linear” species, and the patents-in-suit focus on the “substantially linear” species.

124a

Accordingly, the Court concludes that genuine issues of material fact exist which preclude summary judgment.

With regard to the density of Component B, Plaintiff contends that a Component B can have a density of about 0.965 g/cm 3 even though the specification only describes density of up to 0.944 g/cm 3 because the claimed range of densities is properly described. Plaintiff has presented evidence that the density range of Component B is described, but Defendants have presented evidence indicating that the high end of the density range represents an impossibility. Because an impossibility creates a legitimate possibility that a written description is not satisfied, see Chiron Corp. v. Genetech, Inc., 363 F.3d 1247, 1255 (Fed.Cir.2004), the Court concludes that a reasonable jury could find that the invention is not accurately described. Because genuine issues of material fact exist concerning the aforementioned issues, the Court has denied Plaintiff's and Motions For Summary Judgment.

III. CONCLUSION

For the reasons discussed, Defendants' Motion For Summary Judgment Of Invalidity Based On Dow's “Slope Of Strain Hardening Coefficient” Limitation (D.I.254), Plaintiff's Motion For Summary Judgment That The Claims Of The ’053 And ’023 Patents Are Not Invalid For Lack Of Written Description (D.I.263), and Plaintiff's Motion For Partial Summary Judgment On Nova's New Written Description Defense Based On Dow's Slope Of Strain Hardening Coefficient” Limitation (D.I.291) have been be denied.

An appropriate Order has been entered (D.I.472).

125a APPENDIX F

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

————

Civil Action No. 05-737-JJF

————


Plaintiff, v.

NOVA CHEMICALS CORPORATION (CANADA), and NOVA CHEMICALS INC. (Delaware),


June 25, 2009 ————

Harry J. Roper, Esquire; Aaron A. Barlow, Esquire; Raymond N. Nimrod, Esquire and Darrick J. Hooker, Esquire of JENNER & BLOCK LLP, Chicago, IL.

Rodger D. Smith II, Esquire of MORRIS, NICHOLS, ARSHT & TUNNEL LLP, Wilmington, DE.

Attorneys for Plaintiff The Dow Chemical Company.

Ford F. Farabow, Jr., Esquire; Ronald A. Bleeker, Esquire; Joann M. Neth, Esquire; Martin I. Fuchs, Esquire; Mark J. Feldstein, Esquire; Jeffrey W. Abraham, Esquire Troy A. Petersen, Esquire and Ken Motolenich-Salas, Esquire of FINNEGAN, HENDERSON, FARABOW, GARRETT & DUNNER, L.L.P., Washington, D.C.

H. Woodruff Turner, Esquire; Thomas A. Donovan, Esquire; Robert D. Yeager, Esquire and Brian P.

126a Anderson, Esquire of KIRKPATRICK & LOCKHART PRESTON GATES ELLIS LLP, Pittsburgh, PA.

Richard L. Horwitz, Esquire and David E. Moore, Esquire of POTTER ANDERSON & CORROON LLP, Wilmington, DE.

Attorneys for Defendants NOVA Chemicals Corpora-tion (Canada) and NOVA Chemicals Inc. (Delaware).

MEMORANDUM OPINION

FARNAN, District Judge,

This is a patent infringement case brought by The Dow Chemical Company (“Dow”) against NOVA Chemicals Corporation (Canada) and NOVA Chemi-cals, Inc. (Delaware) (collectively, “NOVA”) alleging infringement of United States Patent Nos. 5,847,053 (“the ’053 patent”) and 6,111,023 (“the ’023 patent”), which pertain to specific ethylene/α-olefin blends comprising (1) at least one homogeneously branched ethylene/ α -olefin interpolymer and (2) a heterogene-ously branched ethylene/ α -olefin interpolymer.(’053 patent at 1:25-35.) The parties briefed their respective positions on claim construction, and the Court conducted a Markman hearing on the disputed terms. This Memorandum Opinion provides constructions for five of the six disputed terms.

BACKGROUND

The patents-in-suit relate “to compositions compris-ing specific ethylene/ α -olefin polymer blends.” (’053 patent at 1:25-27.) In particular, the patents pertain to polymer blends comprising an “(A)” component consisting of at least one “homogeneously branched” ethylene/ α -olefin interpolymer and a “(B)” component consisting of at least one “heterogeneously branched” ethylene polymer. According to the specification, the

127a combination of these two types of polymers results in a composition having “synergistically enhanced physical properties,” including both high tensile strength and high impact strength. (Id. at 1:38-2:5.)

DISCUSSION

I. The Legal Principles of Claim Construction

Claim construction is a question of law. Markman v. Westview Instruments, Inc., 52 F.3d 967, 977-78 (Fed. Cir. 1995), aff’d, 517 U.S. 370, 388-90, 116 S. Ct. 1384, 134 L. Ed. 2d 577 (1996). When construing the claims of a patent, a court considers the literal language of the claim, the patent specification and the prosecution history. Markman, 52 F.3d at 979. Of these sources, the specification is “always highly relevant to the claim construction analysis. Usually it is diapositive; it is the single best guide to the meaning of a disputed term.” Phillips v. AWH Corporation, 415 F.3d 1303, 1312-17 (Fed. Cir. 2005)(quoting Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1582 (Fed. Cir. 1996)). However, “[e]ven when the specification describes only a single embodiment, the claims of the patent will not be read restrictively unless the patentee has demonstrated a clear intention to limit the claim scope using ‘words or expressions of manifest exclusion or restriction.’ “Liebel-Flarsheim Co. v. Medrad, Inc., 358 F.3d 898, 906 (Fed. Cir. 2004) (quoting Teleflex, Inc. v. Ficosa N. Am. Corp., 299 F.3d 1313, 1327 (Fed. Cir. 2002)).

A court may consider extrinsic evidence, including expert and inventor testimony, dictionaries, and learned treatises, in order to assist it in understanding the underlying technology, the meaning of terms to one skilled in the art and how the invention works. Phillips, 415 F.3d at 1318-19; Markman, 52 F.3d at

128a 979-80. However, extrinsic evidence is considered less reliable and less useful in claim construction than the patent and its prosecution history. Phillips, 415 F.3d at 1318-19 (discussing “flaws” inherent in extrinsic evidence and noting that extrinsic evidence “is unlikely to result in a reliable interpretation of a patent claim scope unless considered in the context of intrinsic evidence”).

In addition to these fundamental claim construction principles, a court should also interpret the language in a claim by applying the ordinary and accustomed meaning of the words in the claim. Envirotech Corp. v. Al George, Inc., 730 F.2d 753, 759 (Fed. Cir. 1984). If the patent inventor clearly supplies a different meaning, however, then the claim should be inter-preted according to the meaning supplied by the inventor. Markman, 52 F.3d at 980 (noting that patentee is free to be his own lexicographer, but emphasizing that any special definitions given to words must be clearly set forth in patent). If possible, claims should be construed to uphold validity. In re Yamamoto, 740 F.2d 1569, 1571 (Fed. Cir. 1984).

II. The Meaning of the Disputed Terms

Dow asserts that NOVA infringes all 16 claims of the ’053 patent and all 16 claims of the ’023 patent. The following is an illustrative independent claim from the ’053 patent, with the disputed terms emphasized:

1. A film made from an ethylene polymer composition, wherein the composition comprises (A) from about 10 percent (by weight of the total composition) to about 95 percent (by weight of the total composition) of at least one homogeneously

129a branched linear ethylene/ α-olefin inter-polymer having:

i. a density from about 0.89 grams/cubic centimeter (g/cm3) to about 0.935 g/cm3,

ii. a molecular weight distribution (Mw /Mn) from about 1.8 to about 2.8,

iii. a melt index (12) from about 0.001 grams/10 minutes (g/10 min) to about 10 g/10 min,

iv. no high density fraction,

v. a single melting peak as measured using differential scanning calorimetry, and

vi. a slope of strain hardening coefficient greater than or equal to 1.3; and

(B) from about 5 percent (by weight of the total composition) to about 90 percent (by weight of the total composition) of at least one heterogeneously branched linear ethylene polymer having a density from about 0.93 g/cm3 to about 0.965 g/cm3.

(’053 patent at 15:31-54.) The following is an illustrative independent claim from the ’023 patent, again with the disputed terms emphasized:

1. An ethylene polymer composition comprising (A) from about 10 percent (by weight of the total composition) to about 95 percent (by weight of the total composition) of at least one ethylene interpolymer having:

i. a density from about 0.89 grams/cubic centimeter (g/cm3) to about 0.935 g/cm3,

ii. a melt index (I2) from about 0.001 grams/10 minutes (g/10 min.) to about 10 g/10 min.,

130a iii. a slope of strain hardening coefficient

greater than or equal to 1.3, and

iv. a Composition Distribution Branch Index (CDBI) greater than 50 percent; and

(B) from about 5 percent (by weight of the total composition) to about 90 percent (by weight of the total composition) of at least one ethylene polymer characterized as having a density from about 0.93 g/cm3 to about 0.965 g/cm3 and comprising a linear polymer fraction, as determined using a temperature rising elution fractionation (TREF) technique.

(’023 patent at 15:59-16:39.) Both the claims of the ’053 patent and ’023 patent are directed to polymer compositions consisting of at least two polymers, an “(A)” polymer and a “(B)” polymer. The claims of the two patents differ with respect to the physical properties used to describe the “(A)” and “(B)” components of the polymer blend.

The claim construction dispute that the parties emphasize the most concerns the definition of one such physical property. Specifically, according to NOVA, the claim term “slope of strain hardening coefficient of greater than or equal to 1.3” is indefinite because the specification fails to both adequately specify the units for the “slope of strain hardening coefficient” and set forth a method for measuring this physical parameter. In these circumstances, NOVA contends that one of skill in the art, upon reading the specification, would be unable to determine whether an accused polymer composition falls within the scope of the claims.

A second key claim construction dispute between the parties pertains to the meaning of the well-known transitional phrase “comprising.” NOVA contends

131a that, in this case, the term “comprising” requires a special construction to guard against a possible attempt by Dow to creatively read its claims onto noninfringing products. Briefly, NOVA contends that Dow may attempt to artificially decompose indivisible components of noninfringing products into fictitious sub-components, one or more of which Dow would then characterize as meeting a claim limitation while the remaining components Dow would characterize as mere additional elements allowed under the “compris-ing” transitional phrase.

The remaining claim construction disputes between the parties are typical, generally relating to disagreements over the interplay between the claim language on one side, and the specification and prosecution history on the other. For the reasons that follow, the Court construes the disputed terms as follows.

A. “Slope Of Strain Hardening Coefficient Of Greater Than Or Equal To 1.3”

Dow’s Construction NOVA’S Construction The slope of strain hard-ening multiplied by the melt index raised to the 0.25 power must be greater than or equal to 1.3.

This claim term is indefinite.

The dispute between the parties has two parts. Not only do the parties dispute whether this claim term is indefinite, but the parties dispute the law and procedure that the Court should apply in addressing the indefiniteness dispute.

132a 1. The Law And Procedure For

Addressing Indefiniteness

Dow contends that indefiniteness cases fall into two categories: those that raise issues of fact and those that do not.1 (See D.I. 197 at 2-5.) Along these lines, Dow notes that the Federal Circuit has confirmed that fact issues can indeed permeate an inquiry into indefiniteness. Specifically, the Federal Circuit recently explained as follows:

A determination of claim indefiniteness is a legal conclusion that is drawn from the court’s performance of its duty as the construer of patent claims. To the extent there are any factual findings upon which a trial court’s indefiniteness conclusion depends, they must be proven by the challenger by clear and convincing evidence.

Tech. Licensing Corp. v. Videotek, Inc., 545 F.3d 1316, 1338 (Fed. Cir. 2008) (internal citations omitted).

Though acknowledging that “the determination of indefiniteness is ultimately a question of law,” (D.I. 197 at 2), Dow further contends that “the Federal Circuit treats indefiniteness differently from claim construction.” (D.I. 214 at 3.) Most importantly, Dow

1 The latter category of cases, Dow contends, break down into two general sub-classes. First, there are cases where the intrinsic evidence demonstrates the definiteness of the claims. In these cases, no amount of extrinsic evidence can be used to “inject ambiguity where none exists.” (See id. at 3 (citing Personalized Media Communications, LLC v. ITC, 161 F.3d 696, 706 (Fed. Cir. 1998)).) Second, there are cases “where an irreconcilable contradiction exists within the patent itself.” (D.I. 197 at 3.) Presumably, Dow contends that in these cases, the intrinsic evidence demonstrates the indefiniteness of the claims conclusively, and no amount of extrinsic evidence can rescue the claims.

133a contends that Federal Circuit precedent calls for any fact issues surrounding indefiniteness to be submitted to the jury. (See D.I. 197 at 2, 6 (citing BJ Services Co. v. Halliburton Energy Services, Inc., 338 F.3d 1368, 1372 (Fed. Cir. 2003) (“Like enablement, definiteness, too, is amenable to resolution by the jury where the issues are factual in nature.”)).) Furthermore, Dow takes the position that the trier of fact should consider the evidence pertaining to indefiniteness “as a whole.” (D.I. 214 at 2.) Thus, Dow appears to be of the view that in considering indefiniteness, the Court should not necessarily adopt a preference for the intrinsic evidence over the extrinsic evidence, as is normally done during the claim construction process. See Phillips v. AWH, 415 F.3d 1303, 1317 (Fed. Cir. 2005).

NOVA responds, first and foremost, that “claim construction [is] a purely legal issue,” which the Federal Circuit reviews de novo “including any allegedly fact-based questions relating to claim construction.” Cybor Corp. v. FAS Techs., Inc., 138 F.3d 1447, 1451, 1454-56 (Fed. Cir. 1998). NOVA further notes the long-standing and often-repeated principle that “[a] determination of claim indefinite-ness is a legal conclusion that is drawn from the court’s performance of its duty as the construer of patent claims.” Personalized Media Communs., L.L.C. v. ITC, 161 F.3d 696, 706 (Fed. Cir. 1998). In other words, NOVA emphasizes the link between claim construc-tion and indefiniteness, arguing that to the extent the Federal Circuit admits the existence of fact issues underlying indefiniteness, they should be handled by the Court within the context of the claim construction process. Thus, NOVA does not envision a role for the jury when it comes to indefiniteness. Likewise, NOVA maintains that the Court should evaluate evidence pertaining to indefiniteness in accordance with

134a Supreme Court and Federal Circuit authority on claim construction. See generally Markman v. Westview Instruments, Inc., 52 F.3d 967, 981 (Fed. Cir. 1995); Phillips, 415 F.3d at 1303. Accordingly, NOVA con-tends that in deciding indefiniteness the Court has the “authority to wholly dismiss . . . extrinsic evidence,” such as expert witness testimony, in favor of more reliable intrinsic evidence. (See D.I. 204, Exh. 1 at 2-3, 6.)

On reviewing the authority on this topic, the Court concludes, first, that it is indeed authorized, where appropriate, to address indefiniteness within the context of claim construction using the machinery normally used to handle claim construction. See Praxair, Inc. v. ATMI, Inc., 543 F.3d 1306, 1319 (Fed. Cir. 2008) (“Indefiniteness is a matter of claim construction, and the same principles that generally govern claim construction are applicable to determin-ing whether allegedly indefinite claim language is subject to construction.”); Datamize, LLC v. Plumtree Software, Inc., 417 F.3d 1342, 1348 (Fed. Cir. 2005) (“In the face of an allegation of indefiniteness, general principles of claim construction apply.”). Furthermore, the Court should perhaps even endeavor to adopt this route when possible. See, e.g., Enzo Life Scis., Inc. v. Digene Corp., 305 F. Supp. 2d 406, 408 (D. Del. 2004) (“The claims at issue do not have technical or relational terms that may be understood differently by one of ordinary skill in the art. Instead, Digene’s arguments of indefiniteness involve allegations of internal contradiction based upon the wording of the claims. Thus, as the construer of patent claims, the Court may reach the merits of the indefiniteness question.”).

135a Nevertheless, the Court understands the authority

on this issue as allowing, in appropriate circum-stances, for the submission an indefiniteness dispute to the jury. Indeed, the Federal Circuit’s statement in BJ Services that “definiteness . . . is amenable to resolution by a jury” has not, to the Court’s knowledge, been explicitly overruled. BJ Services, 338 F.3d at 1372-73. Likewise, the Federal Circuit’s recent statement in Technology Licensing admitting the potentiality for fact questions in an indefiniteness inquiry cannot, in the Court’s view, be easily squared with the rigid view advanced by NOVA that the Court must always address indefiniteness within the context of claim construction as a pure legal issue. See Technology Licensing, 545 F.3d at 1316. Along these lines, thr Court noted long ago that “[t]he Federal Circuit has repeatedly stated that indefiniteness is a legal question, and, at the same time, held that in certain circumstances, ‘evidence beyond the claims and written description may be reviewed.’ Derived from such statements is an inherent tension as to the appropriateness of resolving indefiniteness questions as a matter of law.” Enzo, 305 F. Supp. 2d at 408 (quoting Solomon v. Kimberly-Clark Corp., 216 F.3d 1372, 1379 n.4 (Fed. Cir. 2000)).

In fact, numerous other district courts have acknowledged that an indefiniteness inquiry cannot always be strictly equated with or incorporated into the claim construction inquiry. In the Court’s view, the most notable district court opinion on this issue is the Southern District of New York’s opinion in System Mgmt. Arts, Inc. v. Avesta Techs., Inc., 137 F. Supp. 2d 382, 399-400 (S.D.N.Y. 2001). There, the Southern District of New York noted conflicting expert testi-mony in denying a motion for summary judgment on

136a indefiniteness. In so doing, the Court explained as follows:

[W]hile the Federal Circuit has often stated that the indefiniteness inquiry is “drawn from” the district court’s role as a construer of patent claims, see, e.g., Personalized Media, 161 F.3d at 705, the circuit court has not expressly held that these inquiries are one and the same, nor that the indefiniteness inquiry can not involve underlying questions of fact.

Moreover, to state that the indefiniteness inquiry is a question of law or “legal conclusion,” id., does not answer the question. The Federal Circuit has recognized that some questions of law involve underlying issues of fact. See Union Pacific Res. Co. v. Chesapeake Energy Corp., 236 F.3d 684, 57 U.S.P.Q.2D (BNA) 1293, 1296 (Fed. Cir. 2001) (patent enablement is “question of law” but “as is often true of legal questions . . . the ultimate legal conclusion of enablement rests on factual underpinnings . . . .”).

The reasoning of those courts holding that the indefiniteness inquiry may involve underlying issues of fact is persuasive. Indeed, to hold otherwise would seem to mask the actual role being played by the district court.

System Mqmt., 137 F. Supp. at 400. Numerous district courts – both before and after System Mqmt. – appear to have followed this or similar reasoning. See, e.g., A.K. Stamping Co. v. Instrument Specialties Co., 106 F. Supp. 2d 627, 644-45 (D.N.J. 2000) (denying a motion for summary judgment of indefiniteness when a “trier of fact” could conclude based on “the testimony

137a of three engineers” that the claims were not indefi-nite); TC Mfg. Co. v. Polyguard Prods., Inc., No. 06 C 8392, 1999 U.S. Dist. LEXIS 14730 (N.D. III. Sept. 14, 1999) (denying a motion for summary judgment of indefiniteness where there was “support in the record presented for the dispute of a material fact” and concluding that the “issue must await for a resolution at trial where the facts can be evaluated and found . . . .”); Hako-Med USA, Inc. v. Axiom Worldwide, Inc., No. 8:06-cv-1790, 2008 U.S. Dist. LEXIS 64953, at *6 (M.D. Fla. July 29, 2008) (affirming a magistrate judge’s recommendation denying summary judgment of indefiniteness where the magistrate was unable to determine indefiniteness as a matter of law because questions of fact remained); Presidio Components, Inc. v. Am. Tech. Ceramics Corp., No. 08-cv-355, 2008 U.S. Dist. LEXIS 65149, at *9 (S.D. Cal. Aug. 22, 2008) (“As several district courts have observed, however, while the Federal Circuit has described the indefiniteness inquiry as a question of law, where evidence beyond the claims and written description may be reviewed, factual issues are likely to arise.”).

In light of the above persuasive authority, the Court concludes that the law on indefiniteness is not as rigid as NOVA contends. Although it may generally behoove the Court to address indefiniteness as a legal matter in the context of claim construction, there may arise cases where genuine issues of fact simply preclude such a treatment. In these circumstances, the question of indefiniteness must be addressed by the trier of fact.

2. Decision

The slope of strain hardening coefficient (“SHC”) is calculated as follows:

SHC=(slope of strain hardening)(I2)0.25

138a where I2 is the melt index in grams/10 minutes. (’053 patent at 6:45-50.) NOVA raises two arguments in support of the position that the claim term “slope of strain hardening coefficient of greater than or equal to 1.3” is indefinite. First, NOVA contends that this claim term is indefinite because the units for the slope of strain hardening are indeterminable, thus making it impossible to determine the proper units for SHC. Second, NOVA contends that the claim term is indefinite because neither the claims nor specification adequately set forth the methodology for determining the slope of strain hardening. The Court will address each of these arguments in turn.

As to the issue of units, the Court notes that the specification includes a section directed specifically to the determination of the slope of strain hardening coefficient. See ’053 patent at 6:8-43. This passage describes the preparation of the test sample to be used in determining the slope of strain hardening strictly in units of pounds and inches. See, e.g., ’053 patent at 6:13-15 (“The plaque is . . . then pressed under pressure of about 200 psi.”); id. at 6:6:17-18 (“The test piece is 0.315 inches wide and 1.063 inches long.”). Based on this, Dow contends, one of skill in the art could determine that the slope of strain hardening is also to be determined using English units (i.e, pounds and inches). In support of this position, Dow submits the declaration of its expert witness, Dr. Benjamin S. Hsiao. (See D.I. 149 ¶ 13.) The specification further explains that the actual test for determining the slope of strain hardening should be done using an Instron Tensile Tester at a “crosshead speed of 1 inch/minute.” See ’053 patent at 6:25-26. Describing the test parame-ters for determining the slope of strain hardening in units of inches, Dow contends that this further confirms that the slope of strain hardening should also

139a be understood as being in English units. (See D.I. 148 at 13; D.I. 149 ¶ 13.)

In addition, Dow contends that an understanding of English units for the strain hardening coefficient would follow from the patent’s explicit reference to the use of an Instron testing instrument because this instrument operates by default in terms of “US Customary” units, which, like English units, use inches for length and pounds for force. (D.I. 148 at 13.) The parties have each submitted copies of manuals for the Instron instrument, and, on reviewing the manual submitted by NOVA, the Court concludes that Dow’s argument regarding the Instron instrument has some force. Indeed, although the Instron manual explains that the instrument may be operated using multiple unit systems, the manual explains that “the raw data file is stored in US Customary units.” (D.I. 205, Exh. AL at 10-3.) Likewise, when referring to the display of raw data, the manual notes for emphasis that “[s]ince all raw data is stored in US Customary units, all displayed data is in US Customary units also (i.e., lbs., in., etc.).” (Id. at 11-2.) In addition, the Instron manual appears to explicitly confirm that US Customary units are the default units, instructing that a particular menu option “allows you to edit the raw data in either SI, Metric, or Mixed units instead of the default US Customary units.” (Id. at 11-13 (emphasis added).) Thus, in the Court’s view, one of skill in the art could easily conclude that the native units used in connection with the Instron device are pounds and inches and that the slope of strain hardening should thus be computed in such units. This conclusion is made all the more likely by the fact, noted above, that the patent describes the test to determine the slope of strain hardening in terms of English units. In light of this evidence – and the presumption of validity

140a afforded issued patents – the Court is unable to conclude, as a matter of law, that the claims of the ’053 and ’023 patents are invalid as indefinite for failure to adequately specify the units for the slope of strain hardening.

With regard to the methodology for determining the “slope of strain hardening,” the Court again looks to the specification, which explains as follows:

The slope of strain hardening is calculated from the resulting tensile curve by drawing a line parallel to the strain hardening region of the resulting stress/strain curve. The strain harden-ing region occurs after the sample has pulled its initial load ((i.e., stress) usually with little or no elongation during the initial load) and after the sample has gone through a slight drawing stage (usually with little or no increase in load, but with increasing elongation (i.e., strain)). In the strain hardening region, the load and the elongation of the sample both continue to increase. The load increases in the strain hardening region at a much lower rate than during the initial load region and the elongation also increase, again at a rate lower than that experienced in the drawing region. FIG. 1 shows the various stages of the stress/strain curve used to calculate the slope of strain hardening. The slope of the parallel line in the strain hardening region is then determined.

’053 patent at 6:27-43. NOVA contends that the above description is fatally deficient. First, NOVA contends that the passage fails to adequately explain how to draw a “line parallel to the strain hardening region” because the “strain hardening region” can, rather than being linear, actually be curved. (See D.I. 129, Exh. G ¶¶ 14-15 (NOVA’S expert, Dr. Charles Stanley Speed,

141a opines on the curvature of the strain hardening region).) In these circumstances, NOVA contends, there are multiple methods of drawing a line that may be regarded as being “parallel” to the curved “strain hardening region.” (Id.) For instance, NOVA contends that one could draw a line “having the greatest slope in the strain hardening region” or, as another option, a 10% secant line, which corresponds to the “line between the failure or break point and the point at 10 percent extension back from the break point.” (Id.) To the extent the patentee intended to set forth a single, definitive manner for drawing the line parallel to the strain hardening region, NOVA contends that this was to be in “FIG. 1” of the patent, but that this Figure is missing from the patent, a fact that Dow does not dispute. (See D.I. 141 at 2.) Given this uncertainty as to how the slope of strain hardening should be determined, NOVA contends that the claims must now be held indefinite as a matter of law.

The Court does not agree. Although, a figure is indeed missing from the specification, the text describing how to draw the line parallel to the strain hardening region is rather detailed. Indeed, the passage first instructs that the line should be drawn “parallel” to the strain hardening “region.” Based on this guidance, one of skill in the art would be dissuaded from drawing secant lines or tangents that are not substantially parallel to the true strain hardening “region.” As to how one of skill in the art could identify the true strain hardening region, the specification includes numerous details. To wit, the specification explains that the strain hardening region is the region where (1) the sample has pulled its initial load, (2) the sample has already gone through a slight drawing stage, (3) the load and elongation both continue to increase, (4) the load increases at a much

142a lower rate than during the initial load region, and (5) the elongation also increases at a rate lower than experienced in the drawing region. See ’053 patent at 6:25-44. NOVA’s expert, Dr. Hsiao, explains that based on this description one of skill in the art would be able to identify this strain hardening region as a true linear “region” that occurs after the slope of the tensile curve stops arcing upwards but before it possibly begins to decrease again. (See D.I. 149 at 30-31.) To the extent the tensile curve begins to decrease after the true strain hardening region, Dr. Hsiao explains that one of skill in the art would not confuse this with the strain hardening region, but would instead attribute this to either a rupture of the sample or slippage of the sample in the test apparatus. (Id.) On reviewing NOVA’s claim construction briefing and the supporting declaration of its expert, Dr. Speed, the Court concludes that NOVA has not effectively refuted this understanding of how one of skill in the art would identify the strain hardening region. Accordingly, the Court declines to find the claims indefinite as a matter of law.

However, the Court also cannot, at this stage, eliminate the possibility that the claims will ultimately be found indefinite. Indeed, the patent’s failure to explicitly set forth the units for the slope of strain hardening coefficient and include a figure exemplifying the manner for computing the slope of strain hardening is, in the Court’s view, troubling. And NOVA has presented a wide range of compelling evidence and arguments that, in light of this, one of skill in the art would be unable to determine the proper scope of this claim limitation. As just one example, NOVA has elicited testimony from numerous Dow engineers who, after reviewing the patents-in-suit, expressed an inability to calculate the slope of

143a strain hardening. (See, e.g., D.I. 142, Exh. Q at 153:19-154:3; id., Exh. R at 161:7-162:16.) A named inventor on the patents-in-suit was even unable to explain how to carry out this calculation after reviewing the relevant portions of the specification. (See D.I. 130, Exh. I at 209-212 (excerpts of deposition transcript of inventor Pak-Wing Steve Chum).) In these circumstances, a trier of fact would, in the Court’s view, be entitled to conclude that the claims are indefinite.

Accordingly, the Court shall construe the term “slope of strain hardening coefficient of greater than or equal to 1.3” to mean, as Dow contends, “the slope of strain hardening multiplied by the melt index raised to the 0.25 power must be greater than or equal to 1.3.” However, although the Court has provided a construction for this term, NOVA may still present its indefiniteness theory to the jury. Halliburton Energy Services, Inc. v M-I LLC, 514 F.3d 1244, 1251 (Fed. Cir. 2008) (“[E]ven if a claim term’s definition can be reduced to words, the claim is still indefinite if a person of ordinary skill in the art cannot translate the definition into meaningfully precise claim scope.”).

144a B. “Comprising (A) . . . And (B)”

Dow’s Construction NOVA’s Construction A composition that in-cludes at least A and B but may also include additional, unnamed elements.

Composition must con-tain the recited “homog-enously branched linear ethylene/α-olefin inter-polymer” (A) and the recited “heterogeneously branched linear ethylene polymer” (B). Composi-tion may include other components. However, all “homogenously bran-ched linear ethylene/ α-olefin interpolymer(s)” must satisfy the require-ments of element (A) and all “heterogeneously bra-nched linear ethylene polymer(s)” must satisfy the requirement of ele-ment (B)

“‘Comprising’ is a term of art used in claim language which means that the named elements are essential, but other elements may be added and still form a construct within the scope of the claim.” Genentech, Inc. v. Chiron Corp., 112 F.3d 495, 501 (Fed. Cir. 1997); see also Kustom Signals, Inc. v. Applied Concepts, Inc., 264 F.3d 1326, 1332 (Fed. Cir. 2001) (“The open-ended transition ‘comprising’ does not free the claim from its own limitations.”). As this Court recently explained, see Glaxo Group, Ltd. v. Teva Pharms. USA, Inc., No. 07-713-JJF, 2009 U.S. Dist. LEXIS 37494, at *3-*5 (D. Del. Apr. 30, 2009), because

145a the term “comprising” is a term of art in patent law, the Court is unwilling to adopt a specialized definition for this term absent some evidence in the internal record suggesting that such a definition is appropriate. The Court finds no such evidence. Accordingly, for the term “comprising,” the Court will adopt a standard jury instruction, such as the one prepared by the American Institute of Intellectual Property (“AIPLA”),2 or, alternatively, a standard instruction of similar ilk that the parties find agreeable.

NOVA’S argument on this claim term is, in the Court’s view, a premature request for the Court to address an infringement issue within the context of claim construction. Indeed, the principle case relied upon by NOVA, Jeneric/Pentron, Inc. v. Dillon Co., 205 F.3d 1377, 1382 (Fed. Cir. 2000), was not directly addressing the construction of “comprising,” but whether an accused product might infringe under a proper understanding of the term “comprising.” In Jeneric/Pentron, the asserted claim was directed to a porcelain composition “comprising,” among other things, 0-1% CeO2. Id. at 1379. The accused product, however, contained 1.61% CeO2. Attempting to establish infringement, the patentee argued that the CeO2 in the accused product should be broken down into two “functional” components: (1) a portion

2 The AIPLA instruction for infringement of “comprising” claims explains that the “word ‘comprising’ means including the following but not excluding others” and instructs the jury that “the fact that [the Defendant]’s [[product] [method]] might include additional [[components] [method steps]] would not avoid literal infringement . . . .” AIPLA’s Model Patent Jury Instructions 15 (2008), http://www.aipla.org/Content/Content Groups/Publicationsl/Publications_available_for_viewing1/2008_ 03_ 27 _ AIPLA_ Model _Jury_Instructions.pdf

146a including 0.92% of the CeO2 that served as an “antigreening agent” and that met the relevant claim limitation, and (2) a second portion including the remaining 0.69% of the CeO2 that served as an “opacifying or fluroescing” agent and that was merely an additional allowed component under the “compris-ing” transitional phrase. Id. at 1382. The Federal Circuit rejected this argument, explaining that the claim “does not place functional limitations on the percentage of cerium oxide” and that an attempt to “carve out” a portion of the cerium oxide for the purpose of establishing infringement would read out the expressly claimed cerium oxide ranges. Id. at 1383.

NOVA warns the Court that Dow may take the same tack as the plaintiff in Jeneric/Pentron. As an example, NOVA notes that the claim calls for the “homogeneously branched linear ethylene/ α-olefin interpolymer” to have, among other things, a density of about 0.89 g/cm3to about 0.935 g/cm3. NOVA theorizes that under Dow’s proposed construction, Dow could fractionate a non-infringing interpolymer having a density of 0.94 g/cm3 into a first component having a density of 0.92 g/cm3, which would meet the claim limitation, and a second component having a density of 0.96 g/cm3, which Dow would then characterize as simply an extra component allowed under the “comprising” transitional phrase. (See D.I. 141 at 8-9.) In these circumstances, NOVA contends, Dow would be reading out the express claim limitation regarding polymer density.

To the extent Dow’s infringement theory is merely an attempt to artificially decompose a single polymer component into sham sub-components, Jeneric/ Pentron may well be precisely on point such that summary judgment of non-infringement would be

147a warranted. However, the claimed polymer composi-tions comprise “at least one homogeneously branched linear ethylene/α-olefin interpolymer” and “at least one heterogeneously branched linear ethylene polymer.” Thus, the claims appear to explicitly contemplate the possibility of multiple unique polymer components. To the extent the accused products include genuinely unique polymer components in addition to the two specifically claimed polymer components, the presence of those additional components would not preclude a finding of infringement given the transitional phrase “comprising.” Whether the accused products contain such additional components, however, is a question that the Court is simply not capable of addressing on the current factual record and, more importantly, one that is simply not appropriately addressed by the Court during claim construction. Accordingly, the Court will not adopt NOVA’s prophylactic claim construction designed to guard against Dow’s alleged – yet presently unrealized – intention of reading out claim limitations.

148a C. “Homogeneously Branched Linear

Ethylene/ α-Olefin Interpolymer”

Dow’s Construction NOVA’s Construction “Homogeneously branch-ed” means a polymer in which the comonomer is randomly distributed within a given inter-polymer molecule and wherein substantially all of the interpolymer mole-cules have the same ethylene/comonomer ratio within that inter-polymer. “Linear ethyl-ene/ α-olefin interpolymer” means an interpolymer that does not have long chain branching.

Ethylene α-olefin inter-polymer in which the comonomer is randomly distributed within a given interpolymer mole-cule and wherein sub-stantially all of the interpolymer molecules have the same ethylene/ comonomer ratio within that interpolymer. Such interpolymer has a CDBI greater than about 30 percent and no long chain branching. Such interpolymer is not substantially linear as defined in the patent.

To a large degree the parties agree on the construction of this claim term. However, the parties still dispute two aspects of the construction of this term. First, the parties dispute whether this claim term should be construed to require that the interpolymer have a comonomer distribution branching index (“CDBI”) of greater than about 30 percent (NOVA’s position) or not (Dow’s position). Second, the parties dispute whether the Court’s construction should clarify that the “homogeneously branched linear ethylene/ α-olefin interpolymers” are not “substantially linear as defined in the patent” (NOVA’S position) or not (Dow’s position).

149a As to whether this claim term should be understood

in terms of a numerical CDBI range, the Court concludes that supplemental briefing is required. The Court notes that the agreed upon portion of the construction calls for, among other things, “substantially all of the interpolymer molecules [to] have the same ethylene/comonomer ratio within that interpolymer.” Calling for “substantially all” inter-polymer molecules in a sample containing an extraordinarily large number of molecules to have “the same” ethylene comonomer ratio, this limitation appears to be rather stringent. Of course, whether this is truly stringent can only be evaluated within the context of the relevant art and the specification of the ‘053 patent. However, on looking to the specification for additional guidance in this regard, the Court remains unsatisfied. Indeed, the specification explains that the claimed homogeneous polymers can have a CDBI as low as 30%. (’053 patent at 3:48-52.) The specification clarifies that the CDBI is the “weight percent of the polymer molecules having a comonomer content within 50 percent of the median total molar comonomer content.” Thus, by weight, 70% of the interpolymer molecules in a homogeneously branched interpolymer may apparently have an ethylene/ comonomer ratio outside a range within 50% of the median molar comonomer content. The Court is uncertain as to whether this can be fairly squared with a requirement that “substantially all” interpolymer molecules have “the same” ethylene/comonomer ratio. Thus, on this issue, the Court requests that the parties provide clarification. In so doing, the parties may wish to provide numerical examples to illustrate the relevant concepts as they apply to exemplary homogeneously and heterogeneously branched interpolymers.

150a In addition, insofar as the parties’ proposed

constructions rely on the phrase “within that interpolymer,” the Court finds these constructions to be somewhat unclear. Accordingly, the Court further requests the parties clarify what they intend to mean by this phrase.

With respect to whether the Court’s construction of this term should include the clarification that the “homogeneously branched linear ethylene/ α-olefin interpolymers” are “not substantially linear as defined in the patent,” the Court concludes that such a clarification is unnecessary. The Court is unpersuaded that this clarification would add anything material over the parties’ already lengthy proposed constructions. The specification explains that “[t]he homogeneously branched ethylene/ α-olefin interpoly-mer is preferably a homogeneously branched substan-tially linear ethylene/ α-olefin interpolymer as described in U.S. Ser. No. 08/776,130 now U.S. Pat. No. 5,272,236.” U.S. Patent No. 5,272,236, in turn, explains as follows:

The term “substantially linear” polymers means that the polymer backbone is either unsubstituted or substituted with up to 3 long chain branches/1000 carbons. Preferred polymers are substituted with about 0.01 long chain branches/1000 carbons to about 3 long chain branches/1000 carbons, more preferably from about 0.01 long chain branches/1000 carbons to about 1 long chain branches/1000 carbons, and especially from about 0.3 long chain branches/1000 carbons to about 1 long chain branches/1000 carbons. no doubt different

(U.S. Patent No. 5,272,236 at 3:48-57.) Thus, “substantially linear” polymers may have a maximum

151a of three long chain branches. However, the parties have already agreed that the term “homogeneously branched linear ethylene/α-olefin interpolymers” should be construed to have no long chain branching whatsoever. In these circumstances, the Court sees no reason to include a phrase clarifying that such polymers also cannot have more than three long chain branches.

D. “Heterogeneously Branched Linear Ethylene Polymer”

Dow’s Construction NOVA’S Construction A polymer having a distribution of branching different from and broad-er than the homo-geneously branched eth-ylene/ α-olefin.

Ethylene polymer having a distribution of branch-ing different from and broader than the homo-geneously branched ethylene/ α-olefin, in-cluding having a highly branched portion, a medium branched por-tion and an essentially linear portion.

Though the parties are in partial agreement as to the meaning of the term “heterogeneously branched linear ethylene polymer,” NOVA contends that the term should be understood to further require a distribution of polymers having three distinct portions: “a highly branched portion, a medium branched portion and an essentially linear portion.” As principle support for this limitation, NOVA points to the following passage in the specification of the ’053 patent:

152a Heterogeneously branched ethylene/-olefin interpolymers differ from the homogeneously branched ethylene/-olefin interpolymers primar-ily in their branching distribution. For example, heterogeneously branched LLDPE [linear low density polyethylene] polymers have a distribution of branching, including a highly branched portion (similar to a very low density polyethylene), a medium branched portion (similar to a medium branched polyethylene) and an essentially linear portion (similar to linear homopolymer polyethylene). The amount of each of these fractions varies depending upon the whole polymer properties desired. For example, linear homopolymer polyethylene has neither branched nor highly branched fractions, but is linear. A very low density heterogeneous polyethylene having a density from about 0.9 g/cm 3 to about 0.915 g/cm 3 (such as Attane® copolymers, sold by The Dow Chemical Company and Flexomer® sold by Union Carbide Corporation) has a higher percentage of the highly short chain branched fraction, thus lowering the density of the whole polymer.

(’053 patent at 7:33-51 (emphasis added); D.I. 127 at 18-19.) NOVA further notes that in describing “heterogeneously branched ethylene polymers” the specification explains, with reference to examples, that “[t]he amount of each of these [three] fractions varies depending upon the whole polymer properties desired.” (’053 patent at 7:41-43.) Based on this, NOVA contends that “the specification actually makes clear that what differs among heterogeneously branched polymers is not whether or not they contain these three components. It’s just the relative proportions of these three components.” (D.I. 194 at 119:7-12.)

153a Dow responds that NOVA’s relied upon passage

refers only to an exemplary “heterogeneously branch-ed linear ethylene polymer” – specifically, linear low density polyethylene (“LLDPE”). Indeed, Dow notes that in describing the three polymer fractions present in LLDPE it explicitly introduces LLDPE as an “example” of a “heterogeneously branched linear ethylene polymer.” Dow further notes that the specification nowhere states that all types of “heterogeneously branched linear ethylene polymers” must have all three types of branched polymers. In fact, Dow contends, the ’053 patent claims polymer compositions including a range of “heterogeneously branched linear ethylene polymers.” High density polyethylene (“HDPE”), for example, though possibly including a medium branched polymer fraction and an essentially linear polymer fraction, does not necessarily include a highly branched portion, but is nevertheless still a “heterogeneously branched linear ethylene polymer.”

The Court does not import mere examples from the specification into the claims. See Phillips v. AWH Corp., 415 F.3d 1303, 1323 (Fed. Cir. 2005). In addition, “[elven when the specification describes only a single embodiment, the claims of the patent will not be read restrictively unless the patentee has demon-strated a clear intention to limit the claim scope using words or expressions of manifest exclusion or restriction.’” Liebel-Flarsheim Co. v. Medrad, Inc., 358 F.3d 898, 906 (Fed. Cir. 2004)(quoting Teleflex, Inc. v. Ficosa N. Am. Corp., 299 F.3d 1313, 1327 (Fed. Cir. 2002)). The Court agrees with Dow that when the specification refers to the three polymer fractions in LLDPE, it is merely describing an exemplary embodiment of one component of the invention. Indeed, as set forth above, LLDPE is explicitly

154a introduced as an “example.” Furthermore, on reviewing the specification, the Court is unable to identify any “clear intention” to limit this claim term to only a polymer having three distinct portions with different branching properties. Accordingly, the Court will construe the term “heterogeneously branched linear ethylene polymer,” to mean, as Dow contends, “a polymer having a distribution of branching different from and broader than the homogeneously branched ethylene/ α-olefin.”

E. “At Least One Ethylene Interpolymer”

Dow’s Construction NOVA’s Construction A polymer made from ethylene and at least one other comonomer.

At least one substan-tially linear ethylene polymer prepared from a catalyst with con-strained geometry about the metal atom as described in U.S. Patent No. 5,272,236

This claim term appears only in the ’023 patent and is used to refer to the “(A)” component of the claimed polymer blends. The dispute between the parties is essentially whether this claim term should be limited to “substantially linear” ethylene polymers (NOVA’s position) or not (Dow’s position).3 NOVA contends that

3 NOVA’s construction also includes the requirement that this

term refer to a polymer prepared from a “catalyst with constrained geometry about the metal atom.” However, NOVA’s briefing includes little, if any, discussion of this “catalyst” requirement. In fact, NOVA appears to equate this “catalyst” requirement with the limitation that the polymer be “substantially linear.” (See D.I. 141 at 19 (“NOVA proposes that the claim term ‘at least one ethylene interpolymer’ be construed

155a the prosecution history of the ’023 patent confirms that this claim term should be so limited. However, “[i]n order to disavow claim scope during prosecution a patent applicant must clearly and unambiguously express surrender of subject matter.” See Voda v. Cordis Corp., 536 F.3d 1311, 1321 (Fed. Cir. 2008)(citations omitted). Furthermore, “because the prosecution history represents an ongoing negotiation between the PTO and the applicant, rather than the final product of that negotiation, it often lacks the clarity of the specification and thus is less useful for claim construction purposes.” Phillips, 415 F.3d at 1317. Accordingly, this Court is cautious in narrowing the scope of claims based on the prosecution history. As set forth below, in the Court’s view, NOVA has not identified anything in the prosecution history justifying its proposed construction.

First, NOVA notes that during prosecution of the ‘023 patent, Dow stated that an amendment to the specification was made “to more distinctly set forth that the present invention [was] directed to substantially linear ethylene polymers,” a limitation that was expressly present in all the original claims. (D.I. 141 at 18 (emphasis added) (citing D.I. 128, Exh. F at F053).) However, after making this statement, Dow canceled the original claims in favor of new claims that did not include the “substantially linear” limitation. (See D.I. 128, Exh. F at F-074 to F-077.) The examiner thereafter acknowledged that the new

to be limited to a ‘substantially linear ethylene polymer,’ i.e., a ‘polymer prepared from a catalyst with constrained geometry about the metal atom as described in U.S. Patent No. 5,272,236.’”).) Accordingly, the Court understands NOVA as taking the position that the “substantially linear” requirement is interchangeable with the “catalyst” requirement.

156a claims, which are at issue in this case, were not limited to “substantially linear” ethylene polymers but were instead “generic in scope.” (Id. at F-091.) In these circumstances, the Court cannot conclude that Dow’s early statement during prosecution regarding the scope of the invention is effective to limit the scope of the issued claims.

Second, NOVA points to a declaration that Dow submitted in support of patentability (the “Markovich Declaration”) in which Dow allegedly referred to two polymer blends made from substantially linear ethylene polymers as “Inventive Examples” and another polymer blend made from something other than substantially linear ethylene polymers as a mere “Comparative Example.” (Id. at 18-19.) Having characterized the polymer blends with substantially linear ethylene polymers as “inventive,” NOVA contends that Dow demonstrated an intent to limit claim scope. However, the Court has reviewed the Markovich declaration, and, in the Court’s view, Dow was distinguishing the “Inventive Examples” largely on the basis of performance properties, such as slope of strain hardening coefficient, and not on the basis of the presence of a “substantially linear” polymer. (See D.I. 129, Exh. F at F-079.) Furthermore, it appears that the so-called “Comparative Example” referred to in the Markovich declaration was 38.14% “substan-tially linear” polymer, a percentage nearly identical to the two so-called “Inventive Examples.” (Id. at F-081 to F-082.) Thus, the Court cannot conclude that Dow was using the Markovich Declaration to describe “inventive” blends as including a “substantially linear” polymer.

Finally, NOVA contends that “[i]n his statement of his Reasons for Allowance, the Examiner indicated his

157a understanding that the claims were directed to blends made from ‘substantially linear’ ethylene polymers,” and that Dow failed to respond to this statement. (Id. at 19.) However, although such statements by the examiner are perhaps relevant to claim construction, “an applicant’s silence regarding statements made by the examiner during prosecution, without more, cannot amount to a ‘clear and unmistakable disavowal’ of claim scope.” Salazar v. Procter & Gamble Co., 414 F.3d 1342, 1345 (Fed. Cir. 2005). Furthermore, on reviewing the examiner’s Reasons For Allowance, which the Court finds somewhat unclear, the Court concludes that the examiner was, as Dow contends, simply withdrawing an incorrect inherency rejection. In particular, the examiner’s rejection appears to have been based on a mis-understanding that a particular prior art reference disclosed polymer blends made using the same processes used to prepare the polymer blends disclosed in the patent. To the extent the examiner unilaterally distinguished the claimed polymer blends from the prior art, it appears to have been on the basis of an exemplary catalyst used to prepare one component of the polymer blends, which yielded “polyolfeins[sic] with different properties” from those in prior art polymer blends. (See D.I. 129, Exh. F at F-163.) However, the Court sees no evidence that either the examiner – or patentee – understood the claims as being limited to polymer blends prepared using only a single particular catalyst. The Court is thus unpersuaded that the Examiner’s Reasons for Allowance establish a clear and unmistakable disavowal of claim scope.

Having concluded that the prosecution history does not support NOVA’S proposed construction, the Court turns to Dow’s proposed construction. Dow notes

158a that the ’023 patent expressly defines the term “interpolymer” as follows:

The term ‘interpolymer’ is used herein to indicate a copolymer, or a terpolymer, or the like. That is, at least one other comonomer is polymerized with ethylene to make the interpolymer. Ethylene copolymerized with two or more comonomers can also be used to make the homogeneously branched substantially linear interpolymers useful in this invention. Preferred comonomers include the C 3 - C 20 a-olefins, especially propene, isobutyl-lene, 1-butene, 1-hexene, 4-methyl-1-pentene, 1-heptene, 1-octene, 1-nonene, and 1-decene, more preferably 1-butene, 1-hexene, 4-methyl-1-pentene and 1-octene.

’023 patent at 4:1-12 (emphasis added). The Court concludes that this intrinsic evidence adequately supports Dow’s proposed construction. Accordingly, the Court will construe the term “at least one ethylene interpolymer” to mean, as Dow contends, “at least one polymer made from ethylene and at least one other comonomer.”

F. “Ethylene Polymer . . . Comprising A Linear Polymer Fraction”

Dow’s Construction NOVA’s Construction Ethylene polymer means a polymer made from ethylene. A linear poly-mer fraction is a fraction that is either highly branched nor medium branched.

A heterogeneously bran-ched ethylene polymer containing a polymer fraction that is neither branched nor highly branched but is linear.

159a This claim term appears only in the ’023 patent and

is used to refer to the “(B)” component of the claimed polymer blends. The disputes between the parties are (1) whether the phrase “ethylene polymer” should be limited to heterogeneously branched polymers (NOVA’s position) or not (Dow’s position) and (2) whether the phrase “linear polymer fraction” permits some small amount of branching (Dow’s position) or not (NOVA’s position).

As to the first dispute, NOVA contends that the “SUMMARY OF THE INVENTION” portion of the specification describes the overall invention as including two components: a homogeneously branched polymer and a heterogeneously branched polymer. (See D.I. 127 at 2 (citing ’023 patent at 2:25-67.) According to NOVA, the specification then consist-ently describes the invention itself as including these two specific components, failing to set forth an embodiment in which the second component is a generic ethylene polymer rather than a heterogene-ously branched polymer. Indeed, NOVA notes that the specification even includes a section specifically entitled “THE HETEROGENEOUSLY BRANCHED ETHYLENE POLYMER.” (Id. at 24-25.) There, the specification explains that “[t]he ethylene polymer to be combined with the homogeneous ethylene/ α-olefin interpolymer is a heterogeneously branched (e.g., Ziegler polymerized) interpolymer of ethylene . . . .” (‘023 patent at 8:14-18.) The Court further notes that the Abstract explains generally that “[t]he ethylene polymer compositions have at least one homogene-ously branched substantially linear ethylene/ α-olefin interpolymer and at least one heterogeneously branched ethylene polymer.” (Id. at Abstract.) Likewise, the “BACKGROUND OF THE INVEN-TION” attributes the “surprising” physical properties

160a of the new polymer compositions specifically to the combination of a homogeneously branched polymer and a heterogeneously branched polymer. (See ’023 patent at 2:4-8 (“Surprisingly, we have now discovered that film can have synergistically enhanced physical properties, when the film is made from a blend of at least one homogeneously branched ethylene/ α-olefin interpolymer and a heterogeneously branched ethylene/ α-olefin interpolymer.”).)

“Statements that describe the invention as a whole, rather than statements that describe only preferred embodiments, are more likely to support a limiting definition of a claim term.” C.R. Bard, Inc. v. United States Surgical Corp., 388 F.3d 858, 864 (Fed. Cir. 2004). On reviewing the specification, the Court agrees with NOVA that it characterizes the invention as a whole as including (1) a homogeneously branched polymer, and (2) a heterogeneously branched polymer. In particular, as NOVA notes, the “SUMMARY OF THE INVENTION” explains in general terms that the invention pertains to novel polymer compositions, and then sets forth two distinct aspects of the invention. In both aspects, the polymer compositions comprise a “(B)” component that is a “heterogeneously branched ethylene polymer.” (See ’023 patent at 2:25-67.) Although, as Dow notes, this portion of the specification does not use the term “the present invention,” the Court assigns this fact little weight given that the patentee has explicitly labeled this portion of the specification as “THE SUMMARY OF THE INVENTION.” Furthermore, as noted above, the Abstract includes an additional statement of general applicability in which the polymer compositions are characterized – as a whole – as including a “heterogeneously branched ethylene polymer.” On reviewing the remainder of the specification, the Court

161a sees no evidence – and Dow does not cite any – suggesting that the patentee contemplated any embodiment in which the “(B)” component was something other than a heterogeneously branched polymer. On the contrary, as noted above, the specification includes a section specifically detailing “THE HETEROGENEOUSLY BRANCHED ETHY-LENE POLYMER” that is part of the inventive compositions. (See ’023 patent at 8:14-9:12.) Likewise, all embodiments disclosed in the specification include a heterogeneously branched ethylene polymer.

Dow attempts to rebut this evidence in the specification largely through the prosecution history. In particular, Dow notes that prior to examination, Dow deleted the words “heterogeneously branched” from the claims in favor of broader generic language, and that the examiner thereafter acknowledged the broader scope of the claims. (See D.I. 148 at 34 (citing D.I. 129, Exh. F at F-091).) However, in the Court’s view, this aspect of the prosecution history does not overcome the patentee’s clear characterization in the specification of the overall invention as specifically including a heterogeneously branched polymer. Indeed, “the claims cannot be of broader scope than the invention that is set forth in the specification.” On Demand Mach. Corp. v. Ingram Indus., 442 F.3d 1331, 1340 (Fed. Cir. 2006). Dow does not cite any authority, and the Court is not aware of any, suggesting that the prosecution history can be used to broaden the scope of claims beyond that which is supported by the specification.

With respect to whether the phrase “linear polymer fraction” should be understood to allow some small amount of branching, the Court refers to the portion of the specification, noted above, specifically directed to

162a “THE HETEROGENEOUSLY BRANCHED ETHY-LENE POLYMER” used in the claimed polymer compositions. There, as Dow notes, the specification describes linear low density polyethylene (“LLDPE”) as an exemplary heterogeneous polymer that may be used in the invention, noting further that LLDPE contains a “highly branched portion,” a “medium branched portion,” and an “essentially linear portion.” (’023 patent at 8:19-27.) In connection with this description, the specification refers to a figure depicting the results of a temperature rising elution fractionation (“TREF”) study on Dowlex® 2045, a type of heterogeneously branched LLDPE. (Id. at 8:38-44.) The specification explains that this figure graphically depicts the relative amounts of each polymer fraction in Dowlex® 2045. In so doing, it refers to a distinct peak in the TREF study appearing at 98° C (i.e., the rightmost peak in the figure), explaining that this is “the linear’ fraction of the whole polymer.” (Id. at 8:59-62.) Thus, the specification correlates the 98° C “‘linear fraction” with the least branched “essentially linear portion” of LLDPE. In other words, in describing the heterogeneously branched ethylene polymers used in the claimed invention, the specification confirms that the term “linear” may be used to refer to polymers that include some small degree of branching. (See also D.I. 132 ¶ 7 (Dow’s expert, Dr. Joao B.P. Soares, confirms that the 98° C peak in Dowlex contains molecules with some short chain branches).) Because Dow’s construction of the phrase “linear polymer fraction” properly permits some degree of light branching, the Court will adopt it.

Accordingly, the Court will construe the term “ethylene polymer. . . comprising a linear polymer fraction” to mean “a heterogeneously branched

163a ethylene polymer containing a polymer fraction that is neither highly branched nor medium branched.”

CONCLUSION

For the reasons discussed, the Court has construed the disputed terms and/or phrases of the ’053 and ’023 patents as provided herein. An Order consistent with this Memorandum Opinion will be entered setting forth the meanings of the disputed terms and/or phrases in the ’053 and ’023 patents.

164a APPENDIX G


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2014-1431, 2014-1462

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v.



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————

ON PETITION FOR PANEL REHEARING AND REHEARING EN BANC

————

HARRY J. ROPER, Jenner & Block LLP, Chicago, IL, argued for plaintiff-cross-appellant. Also represented by, AARON A. BARLOW, PAUL DAVID MARGOLIS; RAYMOND N. NIMROD, GREGORY D. BONIFIELD, WILLIAM ADAMS, CLELAND B. WELTON, II, Quinn Emanuel Urquhart & Sullivan, LLP, New York, NY.

DONALD ROBERT DUNNER, Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, Washington, DC, argued for defendants-appellants. Also represented by

165a MARK J. FELDSTEIN, RONALD BLEEKER, DARREL CHRISTOPHER KARL.

Before PROST, Chief Judge, NEWMAN, LOURIE, DYK, MOORE, O’MALLEY, REYNA, WALLACH, TARANTO, CHEN, and HUGHES, Circuit Judges.*

PROST, Chief Judge, DYK and WALLACH, Circuit Judges, concur in the denial of the petition for rehearing en banc.

MOORE, Circuit Judge, with whom NEWMAN, O’MALLEY, and TARANTO, Circuit Judges, join, and with whom CHEN, Circuit Judge, joins with respect to parts I and II, concurs in the denial of the petition for rehearing en banc.

O’MALLEY, Circuit Judge, with whom REYNA, Circuit Judge, joins, dissents from the denial of the petition for rehearing en banc.

PER CURIAM.

ORDER

Cross-Appellant The Dow Chemical Company filed a combined petition for rehearing and rehearing en banc. A response to the petition was invited by the court and filed by the Appellants NOVA Chemicals Corporation (Canada) and NOVA Chemicals Inc. (Delaware). The petition and response were referred to the panel that heard the appeal, and thereafter were referred to the circuit judges who are in regular active service. A poll was requested, taken, and failed.

* Circuit Judge Stoll did not participate.

166a Upon consideration thereof,

IT IS ORDERED THAT:

The petition for panel rehearing is denied.

The petition for rehearing en banc is denied.

The mandate of the court will be issued on December 28, 2015.

For the Court

December 17, 2015 /s/ Daniel E. O’Toole Date Daniel E. O’Toole

Clerk of Court

167a UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT ————

2014-1431, 2014-1462 ————

THE DOW CHEMICAL COMPANY, Plaintiff-Cross-Appellant

v. NOVA CHEMICALS CORPORATION (CANADA),

NOVA CHEMICALS INC. (DELAWARE), Defendants-Appellants

———— Appeals from the United States District Court for

the District of Delaware in No. 1:05-cv-00737-LPS, Chief Judge Leonard P. Stark.

———— PROST, Chief Judge, DYK and WALLACH, Circuit Judges, concurring in the denial of the petition for rehearing en banc.

We agree with Judge Moore that clear and convinc-ing evidence is the standard for patent invalidation; that the burden to establish indefiniteness rests with the accused infringer; that findings of fact by juries are entitled to deference; and that knowledge of someone skilled in the art may be pertinent to the indefiniteness question. In particular, we agree that if a skilled person would choose an established method of measurement that may be sufficient to defeat a claim of indefiniteness, even if that method is not set forth in haec verba in the patent itself. The opinion in this case does not depart from, and in fact directly applies, those principles.


FOR THE FEDERAL CIRCUIT

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2014-1431, 2014-1462

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v.



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————

MOORE, Circuit Judge, with whom NEWMAN, O’MALLEY, and TARANTO, Circuit Judges, join, and with whom CHEN, Circuit Judge, joins with respect to parts I and II, concurring in the denial of the petition for rehearing en banc.

While I concur that en banc action is not warranted in this case, I write separately to make clear that the panel’s opinion does not change the law of indefiniteness in three key respects. First, despite Nova’s claim to the contrary, the panel opinion does not and cannot stand for the proposition that extrinsic evidence cannot be relied upon to determine whether, in light of the state of knowledge of the skilled artisan at the time, a patent’s specification is sufficiently

169a definite. Second, despite Dow’s contention that it does, the panel’s opinion does not alter Supreme Court and our own precedent that fact findings made incident to the ultimate legal conclusion of indefiniteness receive deference on appeal. Finally, the panel’s opinion does not alter Supreme Court and our own precedent that the burden of proving indefiniteness, as with any allegation of invalidity, remains on the party challenging validity who must establish it by clear and convincing evidence.

I.

There is no dispute that, under controlling prece-dent, the ultimate question of indefiniteness is one of law. Indefiniteness, like enablement, obviousness, and claim construction, sometimes requires resolution of underlying questions of fact. Teva Pharm. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831, 838 (2015) (“Teva”) (claim construction in indefiniteness); Green Edge Enters., LLC v. Rubber Mulch Etc., LLC, 620 F.3d 1287, 1299 (Fed. Cir. 2010) (“Definiteness . . . and enablement . . . are both questions of law with underlying factual determinations.”); Teva Pharm. USA, Inc. v. Sandoz, Inc., 789 F.3d 1335, 1345 (Fed. Cir. 2015) (“Teva II”) (indefiniteness); Alcon Research Ltd. v. Barr Labs., Inc., 745 F.3d 1180, 1188 (Fed. Cir. 2014) (enablement); Dennison Mfg. Co. v. Panduit Corp., 475 U.S. 809, 811 (1986) (obviousness). There is likewise no dispute that, under controlling precedent, extrinsic evidence may play a significant role in the indefiniteness analysis. Indeed, definiteness is evaluated from the perspective of a person of skill, Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120, 2128 (2014); requires a determination of whether such a skilled person would understand the scope of the claim when it is read in light of the

170a specification, Orthokinetics, Inc. v. Safety Travel Chairs, Inc., 806 F.2d 1565, 1576 (Fed. Cir. 1986); and is evaluated in light of knowledge extant in the art at the time the patent application is filed, W.L. Gore & Assoc., Inc. v. Garlock, Inc., 721 F.2d 1540, 1556–57 (Fed. Cir. 1983). It has long been the case that the patent need not disclose what a skilled artisan would already know. Wellman, Inc. v. Eastman Chem. Co., 642 F.3d 1355, 1367 (Fed. Cir. 2011); see W.L. Gore, 721 F.2d at 1557–58. Nautilus did not change any of those principles; it changed only the governing formulation of the substantive standard for indefinite-ness, which, in many though not all cases, requires factual inquiries into skilled artisans’ understanding.

It would be incorrect to argue that the Dow decision changed this or that the intrinsic record alone must disclose which measurement method to use. Nova defends the decision in its favor by arguing that the decision correctly determined that extrinsic evidence cannot be relied upon to determine which measure-ment method to use. Defs.-Appellants’ Resp. to Dow Chem. Co.’s Combined Pet. For Reh’g & Hr’g En Banc 5. We do not view the Dow decision as standing for such a sweeping change to our law or as limiting extrinsic evidence in this manner. Appreciating what a skilled artisan knew at the time of the invention is pertinent to whether the claims are reasonably clear in their meaning and scope. A question about the state of the knowledge of a skilled artisan is a question of fact, likely necessitating extrinsic evidence to establish. Dow itself recognizes that appreciation of the knowledge of skilled artisans at the time of the invention necessarily arises when trying to discern whether the claims are reasonably clear in their meaning and scope. Dow Chem. Co. v. Nova Chems. Corp., 803 F.3d 620, 635 n.10 (Fed. Cir. 2015) (noting

171a that we considered “the knowledge of one skilled in the art” along with the claim language and prosecution history to conclude that the disputed claim term is definite in Biosig Instruments, Inc. v. Nautilus, Inc., 783 F.3d 1374, 1382–84 (Fed. Cir. 2015)). Thus, Dow does not and cannot stand for the proposition that extrinsic evidence cannot be used to establish the state of knowledge of the skilled artisan, for example, whether one of skill in the art would know which measurement technique to employ to determine the maximum slope of a curve.

Dow’s primary claim in its petition for en banc review is that the panel applied a de novo review to reverse a district court fact finding. The Dow decision cannot change the Supreme Court’s recent holding, unequivocally clear, that fact findings which rely upon extrinsic evidence must be given deference on appeal. Teva, 135 S. Ct. at 835. In explaining that Nautilus changed the indefiniteness standard, Dow relies on two of our post-Nautilus cases, both of which recognize that fact findings underlying an indefiniteness determination are reviewed for clear error. Dow, 803 F.3d at 630–31 (citing Teva II, 789 F.3d at 1341, 1344–45; and Interval Licensing LLC v. AOL, Inc., 766 F.3d 1364, 1371 (Fed. Cir. 2014)). In Teva II, we determined the claims were indefinite because in response to two examiner rejections of indefiniteness of the same term (molecular weight) the patentee made conflicting statements in the prosecution history and the district court’s fact findings—reviewed for clear error—could not overcome the uncertainty due to these statements:

During prosecution of the related ’847 and ’539 patents, which with respect to molecular weight have identical specifications, examiners twice rejected the term “molecular weight” as indefinite

172a for failing to disclose which measure of molecular weight to use (Mp, Mn, or Mw). And the patentee in one instance stated that it was Mw and in the other stated it was Mp. We find no clear error in the district court’s fact finding that one of the statements contained a scientifically erroneous claim. We hold that claim 1 is invalid for indefiniteness by clear and convincing evidence because read in light of the specification and the prosecution history, the patentee has failed to inform with reasonable certainty those skilled in the art about the scope of the invention. On this record, there is not reasonable certainty that molecular weight should be measured using Mp. This is the legal question—and on this question—we reverse the district court.

789 F.3d at 1345 (first emphasis added). And in Interval Licensing we reviewed the district court’s indefiniteness determination de novo because it “rests only on intrinsic evidence, and . . . there are no disputes about underlying questions of fact.” 766 F.3d at 1370 & n.6. Dow cannot alter our precedent or overrule the Supreme Court’s decision that subsidiary fact findings are given deference on appeal.

We have consistently permitted courts to submit legal questions which contain underlying factual issues, like obviousness, enablement, or indefinite-ness, to the jury. See, e.g., BJ Servs. Co. v. Halliburton Energy Servs., Inc., 338 F.3d 1368, 1372 (Fed. Cir. 2003) (“Like enablement, definiteness, too, is amena-ble to resolution by the jury where the issues are factual in nature.”); Orthokinetics, 806 F.2d at 1576; Beachcombers v. WildeWood Creative Prods., Inc., 31 F.3d 1154, 1158 (Fed. Cir. 1994) (explaining that our standard of review for denial of a motion for JMOL in

173a relation to a jury’s conclusion of indefiniteness is “whether the jury’s express or implied findings of fact are supported by substantial evidence, and whether those findings support the conclusion of indefinite-ness”). When the jury renders a general verdict on validity or indefiniteness, we must presume all fact findings in support of that verdict. Circuit Check Inc. v. QXQ Inc., 795 F.3d 1331, 1334 (Fed. Cir. 2015); Jurgens v. McKasy, 927 F.2d 1552, 1557 (Fed. Cir. 1991). And when we review jury fact findings, we do so for substantial evidence. See Orthokinetics, 806 F.2d at 1571. Whatever the results of Dow, it should not be viewed as having changed this well-established law.

II.

Precedent likewise requires that the burden of proving indefiniteness remains on the party challenging validity and that they must establish it by clear and convincing evidence. This burden—of establishing invalidity of issued patent claims—has always been on the party challenging validity. Microsoft Corp. v. i4i Ltd., P’ship, 131 S. Ct. 2238, 2243 (2011) (“‘[a] patent shall be presumed valid’ and ‘[t]he burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity’” (quoting 35 U.S.C. § 282 (alterations in original))); see also Brief for the United States as Amicus Curiae Supporting Respondent at 25, Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120 (2014) (No. 13-369), 2014 WL 1319151 (explain-ing that § 282 “provides no ground for distinguishing indefiniteness from other defenses of invalidity”). In American Hoist & Derrick Co. v. Sowa & Sons, Inc., 725 F.2d 1350, 1360 (Fed. Cir. 1984), we explained that this presumption of validity “imposes the burden of proving invalidity on the attacker. That burden is

174a constant and never changes and is to convince the court of invalidity by clear evidence.” Nearly thirty years later, the Supreme Court agreed with our explanation in American Hoist, noting that Congress had never once amended § 282 to lower the standard of proof despite often amending this section during this time and ongoing criticism of the clear and convincing standard. Microsoft, 131 S. Ct. at 2252. The Supreme Court concluded by stating that “any re-calibration of the standard of proof” of our “correct interpretation of § 282” remains in Congress’s hands. Id. And there it stays to this day.

For the same reasons that Dow cannot alter our re-view of subsidiary fact findings for clear error, Dow cannot and does not change settled law on the burden of proving indefiniteness. The burden of proving indefiniteness, which may include proving what one of skill in the art would know how to do or not know how to do, remains at all times on the party challenging the validity of the patent. In many different arts, measure-ment of some variable may be required (value, temperature, concentration, depth, dispersion, etc.). The burden of proving indefiniteness includes proving not only that multiple measurement techniques exist, but that one of skill in the art would not know how to choose among them. This knowledge of the skilled artisan is part of the proof necessary for indefiniteness and the burden of proving it is on the challenger of validity. No panel of our court could overrule the Supreme Court or this court’s prior precedent on where this burden of proof lies, and the Dow decision should not be read to change this burden of proof.

Because I do not believe that Dow could have changed or did change the law of indefiniteness, I concur in the denial of en banc. No doubt this case was

175a confused by Dow’s reliance on the particular testimony of Dow’s own witness who created his own measure-ment technique rather than simply relying on the state of the knowledge in the art about such measurement techniques.

III.

This is not to say, however, that I agree with the decision in Dow. It is to say only that the questions raised by the panel’s decision appear to be case-specific. It may be that the panel erred. The Dow panel appears to have decided the case on a basis not only not raised by Nova (whether one of skill in the art would know how to select from among multiple measurement techniques to determine maximum slope), but in fact expressly disavowed by Nova. Defs.-Appellants’ Br. 49 (“Of course, one skilled in the art could determine the ‘maximum slope’ location on a stress-strain curve if the artisan knew that such an approach was required by the patents-in-suit.”); Defs.- Appellants’ Reply & Resp. Br. 13–14 (“Of course, one skilled in the art could physically locate and calculate the ‘maximum slope’ on a stress/strain curve if the artisan knew that such a ‘maximum slope’ approach was called for by the patents-in-suit”). And it does so after a jury verdict of no indefiniteness and without giving deference to the jury’s underlying fact findings.

The question of whether one of skill in the art would know which measurement method to use to determine the maximum slope of a curve is unquestionably a factual issue based upon extrinsic evidence. While I may disagree and even find troubling the panel’s resolution of this case and in particular its treatment of this factual issue, that is not a sufficient reason for en banc review. So long as the Dow opinion is not viewed as having changed the law of indefiniteness

176a regarding underlying fact findings, the relevance of extrinsic evidence to the inquiry, or the deference to be given to fact findings, then I concur in the denial of en banc.


FOR THE FEDERAL CIRCUIT

————

2014-1431, 2014-1462

————



v.



————



————

O’MALLEY, Circuit Judge, with whom REYNA, Circuit Judge, joins, dissenting in the denial of the petition for rehearing en banc.

I agree with Judge Moore that both The Dow Chemical Company (“Dow”) and NOVA Chemicals Corporation (“NOVA”) mischaracterize the panel’s decision in this matter. The panel did not and could not effect sweeping changes in the law of indefinite-ness. I write separately, however, because I do not believe the panel should have discussed the law of indefiniteness at all; the panel simply did not have jurisdiction to render the judgment it did.

The panel could not reopen a validity determination that had been the subject of a final judgment that was

178a affirmed on appeal, and as to which the Supreme Court declined review. Even if the Supreme Court’s decision in Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120 (2014) can be viewed as a substantial change in the law of indefiniteness (a point the parties debate), and even if that change justified a different conclusion regarding the validity of the patent-at-issue here than reached by both the district court and a prior panel of this court (which I do not believe it did), there was no appeal before us that would justify this panel’s decision to reach those issues.

In Robert Bosch, LLC v. Pylon Mfg. Corp., 719 F.3d 1305 (Fed. Cir. 2013) (en banc), we declared that different rules of finality apply to this court than to every other Article III court of appeals. Specifically, we concluded that because damages calculations—even those done in the context of a jury trial on damages—constitute no more than an “accounting” within the meaning of 28 U.S.C. § 1292(c)(2), an action can be final for purposes of appeal even where damages determinations remain outstanding. Id. at 1317 (finding that “an ‘accounting’ within the context of § 1292(c)(2) includes a trial on damages . . . [and] that § 1292(c)(2) confers jurisdiction on this court to entertain appeals from patent infringement liability determinations when a trial on damages has not yet occurred”). Indeed, we went so far as to conclude that a determination of a patent’s invalidity, or of a valid patent’s infringement, can be final, and, thus, subject to an immediate appeal, even where a claim of willful infringement remained outstanding. Id. at 1319 (“[W]e hold that § 1292(c)(2) confers jurisdiction on this court to entertain appeals from patent infringement liability determinations when willfulness issues are outstand-ing and remain undecided.”). These appeals are not, according to us, interlocutory appeals; they are

179a appeals from final judgments. Id. at 1308 (framing the relevant inquiry as whether or not determinations of damages and willfulness issues are “accountings” that, under 28 U.S.C. § 1292(c)(2), constitute “exceptions to the final judgment rule”).

This decision authorized, nay encouraged, parties to engage in piecemeal appeals in patent cases and encouraged district judges to authorize the same. The district judge in this case, at the invitation of Appellant NOVA, accepted that invitation. Because the only procedural vehicle that existed for entry of a final judgment on the liability determination in this case was Rule 54(b) of the Federal Rules of Civil Procedure, that is the vehicle the trial court neces-sarily employed. It is also the vehicle we endorsed when the first panel to hear an appeal in this case accepted the appeal and rendered judgment on it.

Having rewritten the rules of appellate finality in Bosch, the current panel now violates the Rules of Civil Procedure by ignoring the implications of the trial court’s Rule 54(b) final judgment in this case and our affirmance of it. The panel also ignores, moreover, the perhaps even more basic rule that an appellate court may not address issues not raised in the judgment on appeal. See Fed. R. App. P. 4(a)(1)(B) (“The notice of appeal may be filed by any party within 60 days after entry of the judgment or order appealed from . . . .” (emphasis added)); accord Singleton v. Wulff, 428 U.S. 106, 120 (1976) (“It is the general rule, of course, that a federal appellate court does not consider an issue not passed upon below.”).

DISCUSSION

Although the panel says that the judgment now on appeal came after a “remand” from this court, that is

180a inaccurate. We did not remand anything in our earlier mandate; there was nothing to remand. The new appeal arises from a completely separate judgment than the original appeal.

Prior to the first appeal, a jury returned a verdict on validity, infringement, and damages, all in Dow’s favor. The trial court then conducted a hearing regarding whether the relief afforded Dow should include not just the damages awarded for past infringement, but a permanent injunction as well. The trial court declined to issue a permanent injunction on July 30, 2010 because, among other reasons, NOVA convinced it that a running royalty until the soon-to-occur expiration of the patent would be adequate to provide Dow the full scope of the relief to which it was entitled. Dow Chem. Co. v. Nova Chems. Corp., 1:05-cv-737 (D. Del. July 30, 2010), ECF No. 603. After that order, NOVA moved for entry of partial final judgment pursuant to Rule 54(b), stating that the only “remaining claims, [Dow’s] claim of willful infringe-ment (D.I. 1, ¶ 18) and NOVA’s antitrust counterclaim (D.I. 40, Counts VII and VIII),” were sufficiently separate that they did not render improper the entry of final judgment on the issues of validity, infringement, and damages. Dow Chem. Co. v. Nova Chems. Corp., 1:05-cv-737 (D. Del. Aug. 17, 2010), ECF No. 612.

While we were not required to accept review of the trial court’s Rule 54(b) judgment on these issues—indeed, we arguably should not have done so even despite Bosch given the pending antitrust counter-claims—we did so. And we affirmed the lower court verdict and findings across the board. That put an end to the proceedings as to that final judgment.

181a While the trial court did proceed to calculate the

measure of ongoing royalties to be awarded in lieu of an injunction once the first appeal was completed, that was not by virtue of a remand on that issue. The district court at all times retained jurisdiction on those issues that were not included in the Rule 54(b) final judgment, and our affirmance ended our consid-eration of all issues that were included in that final judgment. That is how the Rule operates. The trial court merely lifted its own stay on the accounting of post-verdict infringement damages—one imposed for the parties convenience—and on the other claims that actually did remain—willfulness and the antitrust counterclaim.

The record, thus, establishes that Dow was entitled to relief for NOVA’s continued infringement of its patent as of our affirmance of the Rule 54(b) final judgment. When the trial court denied Dow’s request for a permanent injunction, it made clear that a remaining royalty for the life of the patent would be awarded, as it should have. See Finjan, Inc. v. Secure Computing Corp., 626 F.3d 1197, 1213 (Fed. Cir. 2010) (“Accordingly, we have noted that a patentee is ‘not fully compensated’ if ‘the damages award did not include future lost sales.’” (quoting Carborundum Co. v. Molten Metal Equip. Innovations, Inc., 72 F.3d 872, 882 (Fed. Cir. 1995)); see also Whitserve, LLC v. Comput. Packages, Inc., 694 F.3d 10, 38 (Fed. Cir. 2012) (“[W]e would normally direct an accounting of damages flowing from post-verdict and pre-judgment infringement . . . .”); Fresenius USA, Inc. v. Baxter Int’l, Inc., 582 F.3d 1288, 1303 (Fed. Cir. 2009) (holding that “the district court was within its discre-tion to impose a royalty on [post-verdict sales not considered by the jury] in order to fully compensate” the patentee); Ecolab, Inc. v. FMC Corp., 569 F.3d

182a 1335, 1353 n.5 (Fed. Cir. 2009), modified in part by 366 F. App’x 154, 155 (Fed. Cir. 2009) (stating that an accounting should be ordered to adequately compen-sate the patentee). We have consistently treated these as ministerial calculations conducted by the court to reflect the full relief which appropriately should flow from a prior infringement and validity determination.

NOVA acknowledged both the ministerial nature of the calculation remaining before the district court and the final nature of the earlier liability determinations when, in its brief supporting its position on supple-mental damages, it asserted that the only thing left for the district court to do on the damages question was to undertake an “accounting” regarding the dollar amount due to Dow. Dow Chem. Co. v. Nova Chems. Corp., 1:05-cv-737 (D. Del. July 3, 2013), ECF No. 750, at 1. Indeed, NOVA acknowledged that this judgment was “final” as late as September of 2013 when it filed a separate suit against Dow seeking to set aside the judgment under Federal Rule of Civil Procedure 60(d)(1), a motion that only applies to final judgments. Nova Chems. Corp. (Canada) v. Dow Chem. Co., No. 1:13-cv-1601 (D. Del Sep. 23, 2013), ECF No. 1, ¶ 7. Tellingly, NOVA never sought to reopen the question of indefiniteness before the district court and¬ importantly—the judgment rendered by the district court did not address it. Dow Chem. Co. v. Nova Chems. Corp., 1:05-cv-737 (D. Del. July 16, 2010), ECF No. 593 (NOVA arguing how to determine the ongoing royalty, not Dow’s entitlement to that ongoing royalty). The only judgment entered by the district court after its liability determinations were affirmed was one which contained a calculation of damages for the period between the initial infringement judgment and the expiration of the patent. And, that is the only

183a judgment which was appealed to us; it is that judgment which delimits the scope of our jurisdiction.

It was not until that very narrow appeal from that very narrow judgment reached us—long after the patent had expired and the damages period had closed—that the Supreme Court issued its decision in Nautilus. While the panel reaches to apply that later-decided case to the earlier final judgment on validity here, Rule 54(b) prohibits it from doing so. The only thing we should have reviewed on appeal is the measure of royalty owed post-verdict and pre-expiration of the patent that is memorialized in the judgment from which this appeal was taken. See Dow Chem. Co. v. Nova Chems. Corp., 1:05-cv-737 (D. Del. Apr. 23, 2014), ECF No. 764. There should be no question regarding either the validity of Dow’s patent or Dow’s entitlement to damages for the short interim period between the judgment and the expiration of the patent; those had already been established and affirmed. Accord Bosch, 719 F.3d at 1309 (holding that a trial on damages is merely an “accounting”). Importantly, this is not a situation where new, unexpected acts of infringement occurred and the patentee sought new relief to address them. This is a situation where the relief before us in the second appeal was an aspect of the relief to which all parties understood the patentee was entitled as of the long-since affirmed, original verdict; the only question was how much that relief would be. That the parties and the court saw efficiencies from the use of a partial final judgment, and we endorsed that use, does not mean

184a the later accounting opens up reconsideration of all underlying legal issues.1

To justify reaching the indefiniteness issue anew, the panel describes why it believes it is not limited by either the law of the case doctrine or concepts of issue preclusion. But that discussion is an unnecessary detour. First, the law of the case doctrine does not apply when there already has been a Rule 54(b) final judgment on an issue. The “law of the case [doctrine] does not involve preclusion after final judgment, but rather it regulates judicial affairs before final judgment.” Hughes Aircraft Co. v. United States, 86 F.3d 1566, 1581 (Fed. Cir. 1996) (emphasis added) vacated on other grounds, 520 U.S. 1183 (1997); see Wright & Miller § 4478, at 10; Pit. River Home & Agricultural Coop. Ass’n v. United States, 30 F.3d 1088, 1097 (9th Cir. 1994) (“Law of the case is not synonymous with preclusion by final judgment.”). Accordingly, once there was a final judgment on indefiniteness—which we affirmed in the first appeal—the law of the case doctrine no longer applies to that issue.

And, for issue preclusion to apply, the issue must actually be raised in the judgment we are reviewing on appeal. Accord Wright & Miller § 4405 (“Ordinarily both issue preclusion and claim preclusion are enforced by awaiting a second action in which they are pleaded and proved by the party asserting them.”). In this case, the issue of indefiniteness was not pending before the district court in this claim for supplemental

1 It is odd that we would characterize a jury trial on the full range of infringement damages as a mere accounting, but treat the calculation the district court did here as a determination that justifies the reopening of all issues subject to an earlier final judgment.

185a damages; indefiniteness had already been subject to a Rule 54(b) judgment that we affirmed on appeal. Compare Dow Chem. Co. v. Nova Chems. Corp., 1:05-cv-737 (D. Del. Aug. 26, 2010), ECF No. 615 (entering final judgment on “validity, infringement and damages”), with Dow Chem. Co. v. Nova Chems. Corp., 1:05-cv-737 (D. Del. Apr. 14, 2014), ECF No. 763 (“granting the request of [Dow] for supplemental damages but denying its requests for a finding of willful infringement and enhanced damages”). Be-cause indefiniteness was not raised before the district court, and was not part of the judgment on appeal, issue preclusion is not a factor in this appeal.

To be sure, I disagreed with our conclusion in Bosch that piecemeal appeals are appropriate in patent cases. I also believe this court is, at times, too quick to accept certification of judgments under Rule 54(b) from district courts where aspects of the underlying action are unresolved. But my view of the law and best practices on these issues is not the governing one in this circuit. Having authorized appeals from seriatim final judgments and encouraged district courts to employ Rule 54(b) to effectuate those appeals, we should, at minimum, adhere to Rule 54(b) and its dictates.

For these reasons, while I agree with Judge Moore’s concurrence to the extent issues of indefiniteness are in play, I must dissent from the denial of en banc in this matter.

186a APPENDIX H

UNITED STATES CODE Title 35. Patents

Part II. Patentability of Inventions and Grant of Patents

Chapter 11. Application for Patent

35 U.S.C. § 112. Specification[1]

The specification shall contain a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor of carrying out his invention.

The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the applicant regards as his invention.

A claim may be written in independent or, if the nature of the case admits, in dependent or multiple dependent form.

Subject to the following paragraph, a claim in dependent form shall contain a reference to a claim previously set forth and then specify a further limitation of the subject matter claimed. A claim in dependent form shall be construed to incorporate by

1 Section 112 was amended by Section 4(c) of the Leahy-Smith

America Invents Act (“AIA”), Pub. L. No. 112-29, 125 Stat. 284 (2011). The amendments are not material to the instant petition. The pre-AIA version of the statute applies to the patents involved in the case, see id. § 4(e), and is reproduced here.

187a reference all the limitations of the claim to which it refers.

A claim in multiple dependent form shall contain a reference, in the alternative only, to more than one claim previously set forth and then specify a further limitation of the subject matter claimed. A multiple dependent claim shall not serve as a basis for any other multiple dependent claim. A multiple dependent claim shall be construed to incorporate by reference all the limitations of the particular claim in relation to which it is being considered.

An element in a claim for a combination may be expressed as a means or step for performing a specified function without the recital of structure, material, or acts in support thereof, and such claim shall be construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof.

188a UNITED STATES CODE

Title 35. Patents Part III. Patents and Protection of Patent Rights Chapter 29. Remedies for Infringement of Patent,

and Other Actions

35 U.S.C. § 282. Presumption of validity; defenses[2]

A patent shall be presumed valid. Each claim of a patent (whether in independent, dependent, or multi-ple dependent form) shall be presumed valid inde-pendently of the validity of other claims; dependent or multiple dependent claims shall be presumed valid even though dependent upon an invalid claim. Not-withstanding the preceding sentence, if a claim to a composition of matter is held invalid and that claim was the basis of a determination of nonobviousness under section 103(b)(1), the process shall no longer be considered nonobvious solely on the basis of section 103(b)(1). The burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity.

The following shall be defenses in any action involving the validity or infringement of a patent and shall be pleaded:

(1) Noninfringement, absence of liability for infringement or unenforceability,

(2) Invalidity of the patent or any claim in suit on any ground specified in part II of this title as a condition for patentability,

2 Section 282 was also amended in immaterial respects by the

AIA. The pre-AIA version of the statute applies to this action, see AIA §§ 15(e), 20(l), and is reproduced here.

189a (3) Invalidity of the patent or any claim in suit for failure to comply with any requirement of sections 112 or 251 of this title,

(4) Any other fact or act made a defense by this title.

In actions involving the validity or infringement of a patent the party asserting invalidity or noninfringe-ment shall give notice in the pleadings or otherwise in writing to the adverse party at least thirty days before the trial, of the country, number, date, and name of the patentee of any patent, the title, date, and page numbers of any publication to be relied upon as anticipation of the patent in suit or, except in actions in the United States Court of Federal Claims, as showing the state of the art, and the name and address of any person who may be relied upon as the prior inventor or as having prior knowledge of or as having previously used or offered for sale the invention of the patent in suit. In the absence of such notice proof of the said matters may not be made at the trial except on such terms as the court requires. Invalidity of the extension of a patent term or any portion thereof under section 154(b) or 156 of this title because of the material failure—

(1) by the applicant for the extension, or

(2) by the Director,

to comply with the requirements of such section shall be a defense in any action involving the infringement of a patent during the period of the extension of its term and shall be pleaded. A due diligence determina-tion under section 156(d)(2) is not subject to review in such an action.

190a FEDERAL RULES OF CIVIL PROCEDURE

Title VI. Trials

Rule 50. Judgment as a Matter of Law in a Jury Trial; Related Motion for a New Trial; Conditional Ruling

(a) JUDGMENT AS A MATTER OF LAW.

(1) In General. If a party has been fully heard on an issue during a jury trial and the court finds that a reasonable jury would not have a legally sufficient evidentiary basis to find for the party on that issue, the court may:

(A) resolve the issue against the party; and

(B) grant a motion for judgment as a matter of law against the party on a claim or defense that, under the controlling law, can be maintained or defeated only with a favorable finding on that issue.

(2) Motion. A motion for judgment as a matter of law may be made at any time before the case is submitted to the jury. The motion must specify the judgment sought and the law and facts that entitle the movant to the judgment.

(b) RENEWING THE MOTION AFTER TRIAL; ALTERNATIVE MOTION FOR A NEW TRIAL. If the court does not grant a motion for judgment as a matter of law made under Rule 50(a), the court is considered to have submitted the action to the jury subject to the court's later deciding the legal questions raised by the motion. No later than 28 days after the entry of judgment—or if the motion addresses a jury issue not decided by a verdict, no later than 28 days after the jury was discharged—the movant may file a renewed motion for judgment as a matter of law and may include an

191a alternative or joint request for a new trial under Rule 59. In ruling on the renewed motion, the court may:

(1) allow judgment on the verdict, if the jury returned a verdict;

(2) order a new trial; or

(3) direct the entry of judgment as a matter of law.

(c) GRANTING THE RENEWED MOTION; CONDITIONAL RULING ON A MOTION FOR A NEW TRIAL.

(1) In General. If the court grants a renewed motion for judgment as a matter of law, it must also conditionally rule on any motion for a new trial by determining whether a new trial should be granted if the judgment is later vacated or reversed. The court must state the grounds for conditionally granting or denying the motion for a new trial.

(2) Effect of a Conditional Ruling. Conditionally granting the motion for a new trial does not affect the judgment's finality; if the judgment is reversed, the new trial must proceed unless the appellate court orders otherwise. If the motion for a new trial is conditionally denied, the appellee may assert error in that denial; if the judgment is reversed, the case must proceed as the appellate court orders.

(d) TIME FOR A LOSING PARTY'S NEW-TRIAL MOTION. Any motion for a new trial under Rule 59 by a party against whom judgment as a matter of law is rendered must be filed no later than 28 days after the entry of the judgment.

(e) DENYING THE MOTION FOR JUDGMENT AS A MATTER OF LAW; REVERSAL ON APPEAL. If the court denies the motion for judgment as a matter of law, the prevailing

192a party may, as appellee, assert grounds entitling it to a new trial should the appellate court conclude that the trial court erred in denying the motion. If the appellate court reverses the judgment, it may order a new trial, direct the trial court to determine whether a new trial should be granted, or direct the entry of judgment.

193a APPENDIX I

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

————

C.A. No. 05-737-JJF

————

DOW CHEMICAL COMPANY,

Plaintiff,

v.

NOVA CHEMICAL CORPORATION and NOVA CHEMICALS, INC.,

Defendants.

————

Transcript of Proceedings

Before the Honorable Joseph J. Farnan, Jr.

Wilmington, Delaware

May 28, 2010

————

***

[241]

***

DR. SHIH-YAW LAI, after having been first duly sworn, was examined and testified as follows:

***

DIRECT EXAMINATION

***

194a [308]

***

Q. Have you prepared a graphic to show where the maximum appears near the break?

A. Yes.

Q. Let’s go to Dr. Lai’s slide PDEM 254. Dr. Lai, could you explain what you are showing on PDEM 254.

A. Well, this just give example of the low elongation curve. As you can see, the curve continue to curve up until break, and we draw the slope parallel to the line near the break, and that’s where the maximum slope is, and that’s what we use for the calculating slope of strain hardening.

Q. If you could go back to the prior slide just to understand the break, this is where the specimen actually broke in the machine?

A. Yes.

Q. Where on the curve is the break? Where is it on the black line?

A. You graph it right here.

Q. That’s why the curve ends? [309]

A. Yes.

Q. Let’s go back to PDEM 254. The slope appears where? Maximum slope on PDEM 254.

A. Yes.

Q. At the break?

A. At the break.

195a Q. Do you have an example to show the jury of a

curve where the maximum does not appear at the break?

A. Yes, I have.

Q. Let’s go to Dr. Lai’s graphic PDEM 255, please. Could you explain to the jury what you have shown on PDEM 255.

A. Well, occasionally we see some of the curve like this. For example, beyond starting from the strain hardening region and close to end, you see the curve taper off, and this is quite often is — very often is due to the slippage of the grip. When you get to the end point, the grip doesn’t hold firm enough, and you get slippage, and sometimes that’s due to material [310] pretearing or some other effect. We call it the prerip effect. In the case of this, we don’t use the last point or the point that break to calculate slope. Instead we use maximum slope.

Q. Dr. Lai, first of all, do you encounter in your own tests this type of situation with this prebreak effect?

A. Yes.

Q. Is that an unusual event, to have prebreak effect?

A. No, we see it quite often.

Q. Dr. Lai, for a curve like this with a prebreak effect, what is this tapering-off effect with respect to strain hardening?

A. That’s not a true indication of strain hardening, so we will not use that region to calculate slope of strain hardening.

Q. That’s where the grips slipped?

196a A. That’s one possibility.

Q. Where on this curve do you show the prebreak effect?

A. In this case we use the maximum [311] slope along the curve. We use the maximum.

Q. Why would you use the maximum slope in this curve?

A. A represent at that stage that give the material give the highest resistance to the pulling.

***

197a UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

————

C.A. No. 05-737-JJF

————


Plaintiff,

v.


Defendants.

————




June 4, 2010

————

***

[1367]

***

BENJAMIN S. HSIAO, Ph.D.,

the witness herein, having first been duly sworn on oath, was examined and testified as follows:

***

[1368]

198a DIRECT EXAMINATION

***

Q. Dr. Hsiao, where do you work?

A. Currently I’m a professor, also a chairman of the chemistry department at State University at New York at Stoney Brook.

Q. How long have you taught at Stoney Brook?

A. I taught close to 13 years now.

Q. I’d like you to describe your educational background to the jury. Could we project Slide PDEM-0602, please?

***

[A.] Right. I got my bachelor’s degree in chemical engineering from National Taiwan University in 1980s. I I came to this country in 1982. I got my master’s degree in material science, but specialized in polymer science by University of Connecticut in 1984. [1369]

Three years later, I earned my Ph.D. degree, also in materials science, also specializing in polymer science from the University of Connecticut in 1987. Then I spent two years as a post-doctoral researcher in University of Massachusetts at Amherst after I graduated from the University of Connecticut.

Q. Did you join the work force after 1989?

A. Yes, I did.

Q. PDEM-0603, please. I’d like to project, and Dr. Hsiao, can you explain to the jury your first job after finishing your post-doc research?

199a A. Yes. I joined DuPont Fibers as a staff scientist

in Pioneering Laboratory.

Q. And where was your office with DuPont?

A. I worked in the experimental station, Wilmington, Delaware. It’s probably about four miles away from here, four or five.

Q. Could you describe the type of projects that you were working on at DuPont [1370] Fibers in that time frame?

A. Right. I work mainly on polymer fiber, high performance polymer fibers from bulletproof vests like Kevlar fibers to performance fibers like seat belt, air bag, parachute, so on, so forth.

Q. Dr. Hsiao, the jury has heard somewhat about strain hardening and tensile testing. Did you have any experience at DuPont Fibers with those types of tests?

A. Yes, I did.

Q. Okay. Where did you work after DuPont Fibers?

A. I got transferred into the Central Research and Development Division in ‘93. I stayed there for four more years.

Q. What kind of work did you do at DuPont Central Research?

A. Well, I was still working on polymer fibers, but then I broadened my scope to improve polymer films, polymer articles, so on, so forth.

Q. Dr. Hsiao, when did you begin teaching? [1371]

A. Well, I got interested in teaching when I was at DuPont. So I accepted an adjunct associate professor position in Material Science Department at University of Delaware in 1994.

200a Q. What type of courses did you teach?

A. I taught material science related courses including the solid state properties of polymers.

Q. And then what was your next move after that?

A. Well, I really enjoyed teaching, so I quit DuPont in 1997. I accepted a full-time faculty position at the State University of New York at Stoney Brook. Right now we call it Stoney Brook University.

Q. Do you run a research program at Stoney Brook?

A. Yes, I do.

Q. About how many people do research under your guidance?

A. Currently I have about twenty people underneath me. [1372]

Q. And could you describe some of your current research to the jury, please?

A. Well, I still do quite a bit of polymer fibers, polymer films research. But right now I’m focused more on the application part. So mostly I emphasize on the structure, property aspect particular manual structures. I used to — mostly I’m interested in materials for energy, environment and health applications.

Q. Do you conduct any research on the tensile properties of polymers?

A. I still do. Yes.

Q. Do you have any familiarity with the Instron Tensile Tester?

A. Yes. I’m very familiar with it.

201a Q. Is there one in your lap?

A. Yes. There’s one in my lap.

Q. Have you published any articles related to your research?

A. Yes. I published quite diligently. I probably have over 350 papers published. [1373]

Q. Of those 350 papers you published, how many have related to strain hardening of polymers?

A. I think probably about 40, 50 papers dealing with this subject of the strain hardening behavior.

Q. All right. Now, I’d like to talk to you generally about the work that you did in this case. Were you asked to formulate opinions relating to certain subjects in this case?

A. Yes.

Q. What was the general subject matter that you were asked to give opinions on?

A. The matters related to this slope of strain hardening coefficient.

***

[1379]

***

Q. How did the slope of strain hardening relate to developing materials of seatbelts?

A. Well, slope of strain hardening is, well, a really — we try to look for materials that can become very strong in a very short period of time when you do this Instron tensile testing experiment, so you deform the materials at some constant speed, so if materials can be hardened in a very short period of time, that’s a

202a good material in, for instance, seatbelt. You wear a seatbelt. You want the seatbelt to be very soft, very flexible, but during the impact, you want the seatbelt immediately become very strong to hold your body so you won’t collide into the dashboard, so that’s a very attractive property.

Q. And you were conducting slope of strain hardening tests on fibers for seatbelts?

A. Yes, we also looking for other properties on the polymer fibers. [1380]

Q. You also stated you were doing work on fibers for parachutes. Why was the slope of strain hardening relevant to your work on developing fibers for parachutes?

A. Again it’s a similar reason. You want parachute to be able to pack into small compartment to become very soft. Once you jump out of the airplane, you want parachute to open up quickly to sustain your weight. So it’s a property that can become very strong in a very short period of time is a very attractive property.

Q. What kind of slope of strain hardening values were you looking for in your work at DuPont with these materials?

A. We evaluated a wide range of polymer fibers. We always looking for the materials which can have this very — become very strong in a very short time means very high slope of strain hardening values materials, and we select those materials as fine candidates for seatbelt, parachutes, but there also other parameters we looking for too.

***

[1382]

203a Q. Dr. Hsiao, what does the patent teach about how to test the sample once you have it for slope of strain hardening?

***

A. Actually it’s quite clear. The patent teaches how to use an Instron machine or in here is Instron tensile tester which usually for people of ordinary skill in the art, we all call this Instron machine. We use the Instron machine to test the dog-bone samples.

Q. Dr. Lai used an illustration of how the Instron machine works. I’d like to look at that and have you briefly remind the jury how [1383] the Instron machine works and what the result is of the test. Can we go to PDEM 409, please. Remind the jury, what is the set up on the page here?

A. Okay. On the left, remember, a dog-bone sample I just mention. So this sample really look like that, but we always call it dog-bone sample. We have two flat parts, so the Instron machine have two grips, so it’s like a mechanical hand, just hold it. And this is a center part. It’s a thinner part. That’s the curvature right here, so that if you with two hands grab this film, and one hand start stretching. And the upper hand is connected to a load cell, so actually measure the force or the load, so you can measure the load when you keep stretching this materials, so it’s a pretty straightforward instrument.

Q. Let’s run the slide and explain what happens next.

A. So you start stretching the samples. Eventually it break, and this is the force that you measure, and this is the elongation, how much length that you stretch the sample. You can feel the force eventually

204a go through a plateau or draw region then it increase the load again.

Q. What is the portion where the load is increasing again called?

A. That’s called strain hardening region.

Q. Do you have a real-world example of strain hardening you can share with the jury?

A. I do. I actually have this measurement once a day when I try to take the garbage bag out of the garbage can. We all have some experience. Once you load the garbage in garbage can, you try to take the bag off. Your hands is feeling the load, and you can feel the force first increasing, and the bag starts stretching a little bit. You still need some force, but not much. Become constant force. Ad just when you worry whether [1385] bag is going to hold this heavy garbage or not, and it going to stretch a little bit and actually become harder, so this is the harder part, is this strain hardening effect.

Q. Thank you. Once you have the stress/strain curve —

A. Right.

Q. — the result of this test. What’s that called? What’s that white paper there called?

A. This is — can be from a chart recorder, can come from the computer screen.

Q. Once you have that, what is the next step?

A. The next step is you’re determining the slope of strain hardening.

205a Q. Let’s go back to the 023 patent, PDEM 0610.

What does the patent teach with respect to the next step once you generate the curve?

A. Let me just read this sentence for you highlight in yellow here. “The slope of strain hardening is calculated from the resulting tensile [1386] curve in the previous test load versus elongation curve —” we call it tensile curve “— by drawing a line parallel to the strain hardening region of the resulting stress strain curve.”

Q. Let’s go back to your photographic, PDEM 0611. Reading the patent, where would a person skilled in the art a draw a line for the slope of strain hardening?

A. A person with ordinary skill will always try to draw the line at maximum slope region because that’s the best performance of this material.

Q. Explain to the jury why a person would choose the maximum slope based on the teachings of the patent.

A. Right. By the teaching of the patent, you have a draw region, means you have garbage bag. You ca easily draw them, and eventually materials gets hardened. But during the draw region, you have a little bit — you have a strain hardening starts right here, but you still have quite a bit draw region. So you always have a mixture [1387] of draw and strain hardening. Only at the maximum slope that you will have a very maximum strain hardening effect without the draw effect. That’s where the material is performed its best.

Q. You said you have the maximum strain hardening effect without the draw effect. What’s a

206a draw effect, and what’s a strain hardening effect, and what do you mean by having the maximum?

A. So draw effect means you can have a constant load. The materials can deform without increasing the load.

Q. You say the materials are deforming. What’s happening inside the polymer, you might say, during that region you call the drawing region right here?

A. Right. You follow Dr. Lai and Dr. Soares testimony, you know there’s polymer chains like spaghetti. The draw effect means you can orient or extend this chain so, and the strain hardening means that once the chain gets oriented, they actually become harder. This is not a steep transition. [1388] When you a draw this material, part of the chain gets stretched, but part of the chains can get harder, so only at the maximum slope most all the chains will be hardened, so that’s where you can find the slope of strain hardening, at the maximum slope.

Q. Dr. Hsiao, in your opinion, would the idea of the drawing effects versus strain hardening effects be known to a person skilled in the art in 1993?

A. Oh, yes.

Q. Now, Nova, in their open statements, stated that a person skilled in the art would use something called early slope. Do you agree that a person skilled in the art would use early slope, right after the draw region?

A. I disagree.

Q. Can you explain to the jury why you believe a person skilled in the art would not use the early slope rather than the draw region.

207a A. Because if it is too early, part of the slope, it will

be a mixture of the draw effect and strain hardening effect. It’s not [1389] true strain hardening behaviors. Only at this maximum slope you will have this true strain hardening effect.

Q. If we’re looking here where the early slope might be, you said there might be a mixture of effects. What do you mean by that?

A. It means that part of the polymer chains, they start at strain hardening effect right now, but you also have another part of the polymer chain that’s just being drawn so that the effect of strain hardening is — there’s a mixture of this both effects.

Q. So at this point here, after the draw region before when you reached your maximum, some polymer molecules are drawing, and some are strain hardening?

A. That’s right.

Q. Can we go to the next slide. Dr. Hsiao, where would you draw the line? Where would a person skilled in the art draw the line on the this particular curve?

A. Well, the person of ordinary skill would draw the line at the maximum slope.

Q. Following up on this idea of [1390] drawing effect and strain hardening, does the patent actually describe drawing effect and strain hardening?

A. Yes.

Q. Let’s go to PDEM 612, please. Could you describe — read to the jury the portions that you find relevant with respect to teaching drawing and strain hardening.

208a A. Right. I going to read this whole sentence

without this parentheses first then come back to the parentheses. Let me read. “The strain hardening region occurs after the sample has pulled its initial load and after the sample has gone through a slight draw region.” So these two regions are very well defined. And within the parentheses — and they actually describe the stress/strain curve or the tensile curve which I showed you a little bit earlier. So the initial low region usually will, with little or no elongation during the initial load and drawing stage usually with little or no increase in load, but with [1391] increasing elongation, i.e. strain.

Q. What would a person of ordinary skill in the art in April 1993 conclude about where to determine the slope of strain hardening based on the description in the patent?

A. Right. So he or she will try to determine the slope of strain hardening at a maximum slope of the tensile curve.

Q. Dr. Hsiao, if you measured the slope of strain hardening at what Nova is calling the early slope, does that tell you between the two polymers which one has the better slope of strain hardening?

A. No.

Q. Have you prepared a graphic to illustrate this for the jury?

A. I did.

Q. PDEM 613, please. Describe what you have shown on this slide?

A. Well, this materials have a very very different strain hardening behaviors, but if you only measure their early slope, they’re identical, so the early slope

209a does not — cannot [1392] be used to determine the slope of strain hardening, which is the very best performance of — one of the best performance of the polymers.

***

[1421]

***

Q. Okay. Dr. Hsiao, let’s talk about how you measured these slope of strain hardening for that stress/strain curve we were looking at before the break. If we can go back to PDEM-0623. This is the curve that we were looking at with the jury before we took our break. And we see there’s the blue stress/strain curve and you have printed up in load, pounds and extension in inches. Once you add the stress/strain [1422] curve, what did you do next with your curve?

A. Well, I start analyzing the latter part of the curves, try to find the maximum slope and determining the slope of strain hardening.

Q. You said the latter part of the curve?

A. Yes.

Q. Why did you look at the latter part of the curve?

A. That’s because in that region, you can find the true strain hardening with maximum slope, and the earlier part you always have a mixture of a draw stage, so it will not be a true strain hardening.

Q. Dr. Hsiao, is there more than one maximum slope on a curve?

A. Mathematically, maximum means maximum. There’s only one maximum.

210a Q. Can you just generally describe to the jury how

you went about finding the maximum slope in the latter part of the curves you were analyzing.

A. Right. You can see all those [1423] curves that run here all have little curvatures, so I analyze the different segment of this curve and determine the slope and eventually will find the maximum slope in this later part of this curves and determine where is the strain hardening region.

Q. You said you analyzed different segments. What did you mean by analyze different segments?

A. If I take a latter part of this curves, I try to analyze each area of this curves.

Q. To see what the slopes were?

A. Yes.

Q. Let’s show how you did that. Have you prepared a graphic to show how you determined the maximum slope for these test curves?

A. Yes.

Q. Can we go to PDEM 0624, please. Now, there is a rectangular box that’s been added. Can you explain to the jury what that is.

A. Let’s just focus on this small [1424] portion of the line first. Actually there’s a lot of data points within this small box. I call this a segment of data.

Q. Dr. Hsiao, you mentioned there’s data points. We see a nice continuous curve here in terms that it’s a line that goes on. Are there data points that refer to that curve?

A. Actually under this line, I collected probably over 1,500 data points, and the machine actually

211a collect the load versus the length, or we call this elongation or extension. About one every second they collect data. Another second, collect another data. So under this curve, there’s actually over 1,500 data points there.

Q. And you mentioned that you were looking at data points within the box?

A. That’s correct.

Q. Describe that to the jury, what were you doing there?

A. Well, I try to determine the slope of that data set, so what I’m showing you is actually the numbers. For instance, in this box, the [1425] first column is the load, the second column is the elongation. This is in pounds. This is in inches. So this two numbers define one data point, one load, one extension. Another segment, you will measure another data point, so within this small lines, they actually have about fifty data points right there.

Q. Dr. Hsiao, you have — basically each one of these pairs of numbers is a data point?

A. Yes.

Q. And you have 1,500 of those approximately for each curve?

A. Altogether there’s 1,500 data points.

Q. I see where the box is at about two at the extension?


Q. And where is the load at about?

A. So load is about 1.94 pounds, so that the machine is actually very sensitive.

212a Q. Dr. Hsiao, then you said you calculated slope for

the segment. What do you [1426] mean by slope?

A. Slope is how steep this line goes up to — the higher the slope means the steeper it is.

Q. Dr. Hsiao, how did you go about measuring the slope for a data set of fifty points like this? Did you use a ruler, for example?

A. No, I didn’t use a ruler. I use actually a computer program to calculate the slope.

Q. Okay. And how do you go about doing that?

A. I have a routine called linear regression routine. I fit this fifty data points in and determine the slope.

Q. All right. Now, is that — the linear regression. Can you just describe once again very generally what you mean by that?

A. Well, you have — if I plot this data point, it looks very much like straight line already, but they still have some little bit deviations, so I can draw a line. Basically I can find out the slope [1427] is very much like the mean of this line, so you can minimize your deviation, work back to this line, and calculate the slope.

Q. Dr. Hsiao, why did you choose fifty data points for your first segment?

A. Well, actually that turned out the number of data points not too small because if they’re very small, you start being affected by instrumentation noises, so on, so forth. If too big, start getting large curvature, so that seems to be the right segment of data.

Q. Dr. Hsiao, did you do this linear regression analysis by hand or some other method?

213a A. I use a computer to do this.

Q. If you had done the calculations by hand instead of computer, would the answer be different?

A. The answer would be the same, just going to take me a long, long time to do this by hand.

Q. Let’s go back to the whole part where you take the data points up. Next slide, PDEM 0626. [1428] If you determine the slope for one segment, what else did you do besides that one segment?

A. So I moved to different portion of this line. For instance, I move this box up, determine the next area, and repeat the similar procedure to determine the slope.

Q. And, Dr. Hsiao, when you did your work, you did other boxes between these two?

A. Yeah, it’s a very systematic approach. Actually I first carry out this box then I immediately move this box upward a little bit. I measure the slope in that box, and I move that box upward a little bit, so they actually analyze all the areas in between these two boxes as well.

Q. So for the second box then of the other boxes, what did you do for each of the boxes?

A. For instance, we only compare these two boxes, so now I have slope in this, box slope in that box for instance.

Q. And you continued up what we call [1429] the latter part of the curve?

A. Yeah, so I move the box upwards. I can show you another, so this will be another box. So I only show you three boxes. But in reality, I have about 26 boxes in all this region. And each region, each one of those

214a boxes consist of 50 data points. And I measure this. I determine the slope. So at the end, I have 20 slopes — 26 slopes. And I choose the maximum one as the maximum slope.

Q. Okay. With your analysis, you end up with 26 slopes for the last part of the curve?

A. That’s right.

Q. And then you select it on what basis?

A. Oh, I’m looking for the maximum, the biggest slope.

Q. Okay.

A. And so I use this method to determine the maximum slope.

Q. And when you do that, you would [1430] then pick the one that had it. And what would you do?

A. I pick the one that has the highest slope and indicate that’s a maximum slope region.

Q. Okay. Let’s go to the next graphic.

A. Right. So here we go. If — for instance, I always use pink box to determine this is the region that have maximum slope.

Q. Okay. Now, let’s go to the next slide and describe to the jury what you’ve done here.

A. So, and I think it’s very important to take a look at your data because final decision is to us, as you know, as any person of ordinary skill in the art. So I always try to label where my maximum slope is. So I — I design my program to project this box down to a little line. So this can — this line can indicate where’s the maximum, where the maximum slope is. So this is a very unique signature [1431] of this program.

215a Q. Now, Dr. Hsiao, do you know of any others that

do this method where you found the maximum, then you drop a little pink dash mark below it so you remember?

A. No.

Q. Okay. That’s something that —

A. That’s just I want to see it, because it’s very important to analyze the data in a very systematic way, and also determining whether that maximum slope region makes sense or not. So I use this very carefully.

Q. And you said that you think of that as like your signature. What do you mean by that?

A. Oh, I’ve not seen anybody else try to do that.

Q. That has to do with the pink line?

A. Yeah. Yeah.

Q. All right. Now, once you did that, what was your next step?

A. So, I go back to the patent. I read the patent. [1432] Patent wants me to draw line parallel to a strain hardening region. So after I determine the maximum slope segment, I draw a line parallel to the maximum slope region. So this slope will be the slope of strain hardening.

Q. Okay. And the portion where it’s intersecting line is above where the pink mark is?

A. That’s right. That is right. So this is the line drawn according to the patent.

Q. Now, you mentioned that you used a computer to do the calculations. Where did you get the computer program?

216a A. I — I designed it. I wrote it together with one of

my students.

Q. Is it a complicated program?

A. No, it’s not.

***

[1435]

***

Q. Okay. All right. Dr. Hsiao, did you always find the maximum slope for each and every sample at the same point on the curve? [1436]

***

Q. Right here it looks like the maximum here is right, if I go up at the end, where the break is.

A. Right. This one is at the end.

Q. Okay. Did you always find the maximum slope occurred at the end where the break occurs?

A. Oh, no.

Q. Okay. Why is the slope of strain hardening not always at the end of the curve?

A. Because sometimes the sample have end effect or pre-breaks, in fact.

Q. Could you describe to the jury what’s meant by a end or pre-break effect?

A. There would be samples — sample slips, sample rupture, less formed rupture like a partial tear. Those are all end effects, just like you’re picking out the garbage and sometimes garbage forms holes and tears. And that’s called partial tear or rupture. [1437] Sometimes garbage bag just breaks.

217a Q. Okay. Could we go back to — did you encounter

these kind of end effects in your testing of the polymers, the reproduction polymers?

A. Yes.

Q. Could we go back to — did you encounter this kind of end effect in your testing of reproduction polymers?

A. Yes.

***

Q. What is shown on PDEM 631?

A. This is a tensile curve measured by Instron machine. Again a load elongation curve. You see near the end you have a little hook there, and that’s a severe form of an end effect.

Q. It says 604C, specimen two. Is that one of the test curves you generated upon [1438] reproduction?

A. Yes.

Q. Explain to the jury what is happening at the end of the curve where the hook comes down.

A. Well, sample actually — when you stretch it, there actually may be a little holes develop, and eventually holes become little bit bigger, and part of sample actually breaks, but you still have portion of sample still intact, and they can linger and still they can be stretched. But total load that you use to stretch the remaining sample with what little bit left, it become much less. As a result, your load start going downward.

Q. First of all, this is an actual curve from your test; right?


218a Q. And it’s before you put on the pink dash mark?

A. Before my analysis. That’s correct.

Q. Let’s put a line at the end of the [1439] curve. What have you shown here?

A. Well, you showing a line parallel to the end of this curve.

Q. What is the slope of a line that looks like that’s slanted in that direction?

A. It will give you a negative value. Means you going downward, going the wrong direction.

Q. Does that mean that the polymer you’re testing, the 604C, has a negative strain hardening?

A. No.

Q. Can a polymer have a negative strain hardening?

A. Not to my knowledge so far.

Q. Is this what you’re showing on graphic here? Is that where a person skilled in the art could draw a slope of strain hardening for the patent?

A. No, I don’t think person of ordinary skill in the art — not in 1993, not even today — will determine that’s the slope of strain hardening.

Q. Dr. Hsiao, where would persons of [1440] ordinary skill in the art measure the slope of strain hardening on this curve?

A. Well, he or she will still try to find out the maximum slope still in the later part that curves, but definitely not that region.

Q. Dr. Hsiao, let’s add the — where the maximum was found by Dr. Hsiao for this.

219a A. Right. So I run my program, actually determine

the maximum slope is actually in this box, this segment of data. So I draw the line parallel to this portion of the line that have the maximum slope.

Q. Dr. Hsiao, are prebreak effects common —

A. Yes.

Q. — in tensile testing?

A. Yes.

Q. Does it take a Ph.D. to know what we see here on the graphic is a prebreak effect?

A. No, it does not.

Q. Dr. Hsiao, why is it that the maximum here you calculate doesn’t appear just before the break? Just before the hook, I [1441] should say. Why is it that doesn’t occur right before the hook?

A. Well, that means the partial breaks already occurred just before the break, so you have a partial tear here, here, and then the tears become more and more severe. Eventually there will be rupture, breakage, so on, so forth. Right before this hook, there’s already partial tearing occurs.

Q. Indicate where the partial tearing is starting to occur.

A. It’s probably — I would guess that you see this in a little pink right here. The slope start to decrease.

***

[1445]

***

220a Q. Okay. And what ends up happening with

respect to the stress/strain curve based on the little tear that’s inside the specimen?

A. Well, if you do have a little tear, then you have a little bit less sample. So the load that you filled, the curve does not go as high as you should. So actually curve — curvature starts — the slope start decreasing. The curve starts not going as high as it shows ramping and in this direction.

Q. Can you relate the idea of a tear like this to the example you gave earlier with respect to —

A. Yeah. Well, again, very often that you take the garbage up and you can rip the bags. But bag’s too strong. The overall — the load’s still [1446] increasing. But since you have some small holes there, and the bag is not strong as it should be. So this load does not go as high as it should.

Q. What would cause a partial tear like that in the garbage bag?

A. Again, I guess dust defects can also sometimes cause it, too, during the molding process.

Q. At the plant that’s making the garbage bag?

A. Yeah. Yeah.

Q. Okay. Let’s zoom in on the end of the curve now.

A. Right.

Q. And can you describe to the jury what is shown here with respect to the partial tear and its effect?

A. Right. You can see the curve. The curve, if there was not this tear, it would go higher this direction. With a tear, they start turning to the right.

221a Q. So, in this instance, you didn’t get the hook

down, but it’s starting to slant [1447] downward?

A. Right.

Q. Okay. Now, let’s zoom back out, if we could.

A. Okay.

Q. Where would a person of ordinary skill in the art draw the line to explain strain hardening region on this part here?

A. It would not be at the end because the maximum slope probably would be before this hook starts to appear.

Q. Would a person skilled in the art understand that this hook was not reflective of the slope of strain hardening?

A. Yes.

Q. Let’s show where the line is, then. If we could put that up.

A. Okay.

Q. Describe to the jury what you’re showing here.

A. So what I’m showing here, this is a maximum slope region. And so this is the true strain hardening region.

MR. NIMROD: Can we click one more [1448] to show where the line is?

THE WITNESS: Yeah. One should draw a line like this. As you can see very well, this line represents the true strain hardening region.

BY MR. NIMROD:

Q. Would a person of ordinary skill in the art have known about partial tears in April of 1993?

222a A. Yes.

Q. And would a person of ordinary skill in the art know about partial tears today?

A. Of course.

Q. Dr. [Hsiao], we’re going to go through the numerical results of your tests in a few moments, but could we first have you summarize the work you did to get to the final numbers. If we go to PDEM-0640, please.

A. Yes.

Q. Can you please summarize for the jury what steps you took to determine the slope of strain hardening for the samples?

A. Right. So I took five different [1449] steps. First, I make the sample. I followed the patent. And the second step is I test the sample using the Instron machine just as the patent teaches. So then I make a graph. Patent calls for stress/strain curve or tensile curve. I know it’s a generic term. It’s really load elongation curve. Then I analyze the data, try to determine where the maximum slope is. And then I — after I identify maximum slope segment, I draw a line. And this line will be a line parallel to the strain hardening region just as stated in the patent. So it’s very straight forward.

***

223a UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF DELAWARE

————

C.A. No. 05-737-JJF

————


Plaintiff,

v.


Defendants.

————




June 7, 2010

————

***

[BENJAMIN S. HSIAO, Ph.D.,

the witness herein, having first been duly sworn on oath, was examined and testified as follows:

DIRECT EXAMINATION]

***

[1473]

***

224a Q. Dr. Hsiao, you testified on Friday that you

consider part of this to be like your signature. Which part were you referring to?

A. This pink horizontal bar is usually my signature.

Q. Dr. Hsiao, were you the first person to do that moving box method you talked about?

A. No, I’m not.

Q. Are you the first person to draw [1474] the line at the maximum?

A. No.

Q. Dr. Hsiao, do you need to draw the pink mark to find the maximum?

A. No, I draw it because I always like to take a look at my curve and also compare with my results.

Q. Dr. Hsiao, on Friday you also testified about the drawing effects and also strain hardening effects.

***

Q. Dr. Hsiao, come to the Elmo and draw what you mean by strain hardening, drawing effects, and mixed effects.

A. (The witness complies.) So this is the load. This is the elongation. So this is one of the curves. So in this region is the initial load region, so you have polymer chains that’s [1475] organized into crystal. So this is a crystal, and you have chains in between. And when you draw this materials, the crystal gets oriented, so you will increase the force in this region. You can have — okay. So those lines are indicates polymer chains, so some of the chains that get stretched out from the crystal, and so as a result, you start drawing stage.

225a Drawing stage still takes some work, so — but there’s an increase to the load, so as a result, you don’t have to take additional load to draw some of the chain out. So once the chains get drawn, eventually at the end they will become oriented because. They’re oriented. They will become strong, so this is strain hardening. But this process is continuous process, so you don’t draw all the chains out immediately. Some of the chains will be drawn; some of the chains will get oriented, so in between this stage, you always have a mixed effect.

Q. Dr. Hsiao, to remind the jury, the [1476] polymer samples you’re looking at have billions of different molecules?

A. Yes, there are billions of different molecules. They can be think like a spaghetti, and some of the chains, they’re oriented into regular structure called crystal. Some of them are still tangled spaghetti. Once you start drawing the polymer and polymer chains in the viscous region or in the amorphous region, it gets stretch oriented because they’re stretch oriented, so they start strain hardening effect. Only at the later stage, at the true maximum slope region, you will have a true, complete strain hardening effect.

***

Q. Dr. Hsiao, these type of effects you talked about, drawing effects and strain [1477] hardening effects would be known to persons skilled in art in April 1993?

A. Yes.

***

[1488]

CROSS-EXAMINATION

226a ***

[1551]

***

Q. And so what the patent says about the strain hardening region is it’s the region that occurs after the drawing stage; correct?


Q. And if we could go to DTX 9, please, in your book, Dr. Hsiao.

A. Okay.

Q. This is — which is already in evidence, can we put it up, please. This is a later Dow patent related to the same subject [1552] matter. Is that correct, Dr. Hsiao? Zoom in on the top half of the document, please.

A. Yes, that’s correct.

Q. And if you go into the fourth page, Dr. Hsiao, there is a Figure 2. Can we zoom in on Figure 2. Figure 2. The top, please. And here it shows that drawing region, the relatively horizontal region here between zero and maybe half or so in the extension; correct?


Q. And then the strain hardening region begins when the sample initially rises; correct?


Q. And so the strain hardening region begins after the draw stage; correct?


Q. And that’s what the patent says, is that the strain hardening region occurs after the relatively flat draw region; correct? Correct?

227a A. That’s correct.

Q. The patent doesn’t refer anywhere [1553] to a mixed region; correct?

A. No, it doesn’t.

Q. And so it doesn’t tell you to wait to measure slope of strain hardening until after some mixed region, it says the opposite, it says the strain hardening region occurs after the draw region; correct?


Q. And this is how Dow illustrated in the later patent the strain hardening region goes all the way from this low end where it initially starts to rise all the way to the point of failure; correct?

A. That’s correct. However, if you look at this method that been discussed in this patent using this line, it’s clearly parallel, it’s clearly past the maximum slope.

Q. Well, it’s not defined as to use the maximum slope in this patent, is it, Dr. Hsiao?

A. It’s not defined, but for again, I use, if you allow me to use the word person of ordinary skill in the art, look at it, I would know that that’s a maximum slope. [1554]

Q. The definition for how you draw the line in this patent is very specific, Dr. Hsiao, it tells you to use a ten percent secant tangent; correct?


Q. That’s mathematically different from the method you used to analyze Nova’s samples, correct, the Terneuzen samples?

228a A. It can be the same, if there is a maximum slope

it would be the same.

Q. If the line is linear at the end?

A. Yeah. And also have a maximum slope right here and that would be the same.

Q. Sometimes it’s the same by chance; correct?

A. Not by chance.

Q. Not by chance?

A. Well, sometimes it’s the same.

Q. Sometimes it’s different; right?

A. Sometimes different, that’s correct.

Q. A ten percent secant tangent is not the equivalent of the definition to use maximum slope, is it? [1555]

A. No, it’s not.

Q. Here they provide a specific definition, it’s not the same definition as the maximum slope definition you’re using; correct?

A. It’s not the same definition, but just look in this figure alone, one would decide this is the maximum slope.

Q. Okay. I fear we’re getting confusing, Dr. Hsiao, and it’s probably my fault. But you keep talking about this one figure.

A. Right.

Q. And it seems to me that you’re suggesting that all data looks like this where it’s linear and straight in the end?

A. Not all data looks like that.

229a Q. Very little data is as nice as this idealized curve;

right?


Q. So in real data, the ten percent secant tangent method defined here is different than the maximum slope that you used to measure Dow’s Terneuzen material; correct?

A. That’s correct. [1556]

Q. And so we don’t want to confuse the jury to think that ten percent secant tangent in real data means a maximum slope, it doesn’t, does it?

A. In the real data it doesn’t, but it can be. However, I mean, by reading this curve graph, yeah, you’re right. But this graph happen to illustrate this method is the same as maximum slope method.

Q. By chance in this case, Dr. Hsiao; correct?

A. I do not know by chance or secant tangent or the inventors.

Q. Let’s look a little further into the ‘398 patent, and if we can look at column ten, please.

A. ‘398 patent?

Q. Yes, the one you’re in, Dr. Hsiao.

A. Okay.

Q. Column ten, please. The paragraph beginning at line 60.

A. Uh-huh.

Q. At line 60. This section, Dr. Hsiao, is part of determining the slope of [1557] strain hardening coefficient. Zoom in on paragraph beginning at line 60. Perfect. And this is part of how the 398 patent

230a describes determining the strain hardening coefficient; correct?


Q. And the second sentence says, “The slope of strain hardening is calculated from the resulting tensile curve by drawing a line parallel to the strain hardening region (i.e. a ten percent secant tangent line)”?

A. Yes.

Q. Do you understand in this case it says “a line parallel to the strain hardening region (i.e. a ten percent secant tangent line)” is defining slope of strain hardening to be the ten percent secant tangent line?

A. It’s in there to define it. That’s correct.

Q. We don’t want to confuse the jury, Dr. Hsiao. It’s only in some cases will a ten percent secant tangent line and maximum slope as [1558] you calculated — only in some cases will be the same?

A. Yes.

Q. And so you keep referring over and over again to the figure in that patent, the ‘398 patent, doesn’t make a ten percent secant tangent line equal to the maximum slope in the data that you actually used for Terneuzen; correct?

A. That’s correct; however, the person of ordinary skill will look at the figures and probably will also conclude that only where the figures once you generate figures like that, so one would be able to use that ten percent secant tangent line correctly.

***

[1579]

231a ***

Q. Now, let’s look at and turn to DTX 369 in your binder, please. Do you recognize this, Dr. Hsiao, as another Dow technical report on polyolefins?

A. Yes.

Q. And it refers in the title to tie-molecule density; correct?

A. Yes.

Q. And that’s the similar general subject matter you talked about in your – some of your testimony and Dr. Lai talked about in his testimony; correct?

A. Yes.

***

Q. This report on the first page is from January 1993; correct, Dr. Hsiao?

A. Yes.

Q. That’s before the patents in this case were filed; correct? [1580]


Q. Can we turn, please, to page five. There’s a section 2.2, experimental method. And this is an experimental method for determining slope of strain hardening; correct?


Q. If you go to five lines on the right, “The strain hardening region, SSH, was measured by manually selecting two points in the most linear part of the strain hardening region and dividing the delta stress by the delta strain.” Is that correct?


232a Q. And this definition of how slope of strain

hardening is measured in Dow’s confidential reports is not how you determined slope of strain hardening; correct?

A. Again it may be the same. It may be. It can be the same too.

Q. Let’s try the way we got it to work previously, Dr. Hsiao. To the extent there’s a difference between the slope calculated in this method, the most linear part, and the slope calculated by the maximum slope that you used to accuse Nova of infringement, your slope is going to be higher; correct?

A. Yes; however, it can be the same too.

Q. It can be the same; it can different; right? We agree?

A. Yes, I agree.

Q. And to the extent it’s different, again your method produces a higher slope of strain hardening; correct?


Q. And you don’t, I take it, like the word bias, but that’s what it does. It shifts the data to higher values; correct?

A. It cannot shift the data. It measure the real-world curves.

Q. If you had used the most linear part of the strain hardening region to determine the slope of strain hardening for the material made in Terneuzen that you’re asserting is the same as Nova’s SURPASS, if you had used that [1582] method, the slope of strain hardening, if anything, would have been lower;

233a correct? Can you answer the question and then explain if you like.

A. Yes, that’s correct; however, I just want to point out manually selecting two points in maximum slope. Slope will be the same answer.

Q. Sometimes it will be the same; sometimes not?

A. If you choose the wrong two points, it will be different.

Q. It tells you to select in the most linear part of the region, not the maximum part of the region; is that correct?


Q. This part says to take not the maximum part, the linear part?


Q. And so it’s different than what you’re doing?

A. Correct. That’s correct.

***

[1616]

***

Q. Okay. Now, Dr. Hsiao, do you read the ‘053 and ‘023 patents to suggest drawing a line by hand to calculate slope of strain hardening?

A. It didn’t mention drawing line by hand.

Q. It didn’t mention a lot of things. Do you read it as drawing by hand?

A. I read it, it teaches me to draw a line. [1617] Q. Okay. Does it teach you to draw a line by hand, Dr. Hsiao?

234a A. I guess you can draw them manually by hand,

you can draw it with computer, you can draw a line with the help of a ruler if you wish to.

Q. Are you saying that you can — well, you read the expert report of Professor Crist and Professor Soares; correct?


Q. And you agree with them; correct?

A. Yes.

Q. Okay. And didn’t Dr. Soares say in his report that, in fact, given that at the time the patent was filed the inventors were using an Instron tensile tester that was hooked up to a chart recorder rather than a computer, the line needed to be drawn by hand?

A. Yeah, you can be drawn by hand.

Q. He said, and you agreed with his report, the line needed to be drawn by hand, didn’t he?

23 A. Oh, that I would not agree. I think by reading the patent, it just say drawing [1618] a line.

***

[1620]

***

Q. You didn’t draw the line by hand; correct?

A. No, I didn’t, although I tried in the very beginning.

Q. Did you produce those results in the case, Dr. Hsiao?

A. No, just for my —

235a Q. You considered drawing by hand and then went

to the computer program?

A. That’s correct. There were too many samples.

Q. How many samples were there?

A. I think altogether probably close over 100 samples probably, close to even 200 samples.

Q. So 200 samples. How long does it take to calculate by hand the slope of strain hardening for one curve?

A. Do it correctly, approximation can be quite quick.

Q. How long?

A. Approximation, just by getting our [1621] reference, probably five, ten minutes.

Q. Five, ten minutes to draw one slope?

A. Draw a line and check with the data and calculate the slope, determine carefully, and draw another line, see if the previous estimation is good. So that takes a little time.

Q. So ten minutes, 200 samples. If you had done it by hand —

A. I would say much longer than that.

***

[1639]

***

MR. FELDSTEIN: Can you put up Demonstrative Exhibit one. If you can put it up at the same time, we'll switch back and forth.

BY MR. FELDSTEIN:

236a Q. Here you relied on your experience to indicate

there was a change in slope due to slippage?

A. Right. You see this curve is quite different at the end. You do have a slowing down of the curves, but I still use this region. That's after this changing of slope, in your words.

Q. You use the region after the change in slope, Dr. Hsiao?

A. No. No. No. No, the curves between this one and previous one are quite similar.

Q. Right, and this is a bad one?

A. This is the impact is right here.

Q. This is a problem. This change in slope is a problem; correct?

A. It can be a problem.

Q. If we zoom in on the bottom one, [1640] please, the change in slope on the left, in our report, that's a problem; yes?

A. Yes.

Q. The change in slope on the right is indicative of how you make a judgment of parallel to the strain hardening region. That change in slope is not a problem; correct?

A. Because I rely on maximum slope, that's correct.

Q. And the patent calls for parallel; correct?

A. Yes.

Q. The patent doesn't call for maximum slope; correct?

A. It didn't say that explicitly.

237a Q. Person skilled in the art, Dr. Hsiao?

A. Yes, I believe so.

Q. Now, you again testified that you looked at all your data to ensure that the spot you chose for the slope of strain hardening would be an appropriate spot; correct?

A. Yes.

***

[1700]

REDIRECT EXAMINATION

***

[1752]

Q. Let’s go to another exhibit you were shown on your cross. That is DTX Nine, which is the 398 patent. If we could go to column ten, please. [1753]

***

Q. Dr. Hsiao, what is the filing date of this patent?

A. Filing date is November 1st, 1999.

Q. And what’s the date it went into issue?

A. Issued in April 20th, 2004.

Q. And this is — that would be about six years from the filing date after the April ‘93 date you were considering?


***

Q. Dr. Hsiao, do you see you were shown a portion on your cross says “The slope of strain hardening is calculated from the resulting tensile curve by drawing

238a a line parallel to the strain hardening region, i.e. a ten percent secant [1754] tangent line.” Do you recall that on your cross?

A. Yes.

Q. And you were asked, does it mean the patent is restricted? You have to use that that method according to this patent? Do you recall that question?

A. Yes.

Q. Let’s go to column eleven.

MR. NIMROD: Dave, let’s go down now to column eleven, this paragraph, figure two and up about there.

BY MR. NIMROD:

Q. Here again it goes on. Figure Two shows a tensile curve with the various stages of strain hardening as well as the slope of strain hardening. Do you see that?

A. Yes.

Q. And it states “The slope of strain hardening is conveniently taken as the line representing a ten percent secant tangent which is calculated from —” and goes on?

A. Right. [1755]

Q. What does it state below that about another methodology?

A. Right. It reads “A more precise methodology for calculating the slope of strain hardening is performing linear regression analysis using the tensile curve data points that represent the last ten percent extension before the failure point.”

239a Q. Dr. Hsiao, were you shown that portion on your

cross?

A. No.

Q. Dr. Hsiao, according to this patent, are you restricted to one method —

A. No.

Q. — for determining the slope of strain hardening?

A. No.

Q. Dr. Hsiao, can we go back —

***

Q. Dr. Hsiao, would a person skilled in the art use something like the ten percent [1756] secant method or the last ten percent linear regression method if it gave them a negative slope?

A. No.

Q. Once again explain why that would be the case to the jury.

A. Because those materials will have a negative slope strain hardening, at least to my knowledge.

***

Q. Figure two, Dr. Hsiao, lists results using maximum slope, ten percent secant, portion just before rupture, last ten percent, et cetera. Will they give you the same or different values for this type of curve?

A. For this type of curve, it will give you the same answer.

Q. They will all be equivalent to what?

240a A. They will be equivalent to the [1757] maximum

slope method.

Q. Dr. Hsiao, if you get — if a person skilled in the art were to use the ten percent secant method and get a 1.5 slope of strain hardening, and used the maximum method and got a 1.6, for example, what would the person skilled in the art decide about if that polymer met the limitation of 1.3 or greater?

A. Even you use a less accurate method, then the person of ordinary skill in the art will already condition — conclude that it’s already meet the limitation of the claim.

***

[1758]

***

Q. Dr. Hsiao, Nova's counsel asked you questions about whether you would get the same or different result using maximum slope. Do you recall that?

A. Yes.

Q. Did Nova's counsel provide you [1759] with any curves from this research showing the linear results from the strain hardening region was anything other than maximum?

A. No.

MR. NIMROD: If we could go to DTX Nine, Figure Two, Dave.

BY MR. NIMROD:

Q. If you use the linear region in Figure Nine, your specimen looks like that. What value do you get as compared to maximum slope?

241a A. You will get the same value.

Q. And Nova's counsel said that maybe the results were different. Once again did he show you any curves whatsoever from this report that showed they were getting anything other than the maximum slope?

A. No.

Q. If in fact the linear region was showing something less than maximum, is that something someone skilled in the art would recognize when they viewed the sample?

A. Yes.

***

242a UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF DELAWARE

————

C.A. No. 05-737-JJF

————


Plaintiff,

v.


Defendants.

————




June 10, 2010

————

***

[2458]

DR. GERALD FULLER,

after having been first duly sworn, was examined and testified as follows:

***

[2526]

CROSS-EXAMINATION

***

243a [2542]

***

BY MR. NIMROD:

Q. Did you say in your expert report that average slope would be imprecise?

A. I don’t remember that, but I don’t disagree.

Q. You also talked about linear slope in your expert report, didn’t you?

A. Yes.

Q. Did you state that linear slope would not be appropriate in some instances? Is it if, in fact, the case that linear slope is not the one to choose in instances if there’s a [2543] curve in the stress/strain curve?

A. By definition, a curve has a multitude of slopes.

Q. Dr. Fuller, you would agree, would you not, that there are instances where there is no linear region, and in this industry, people still take slope based on maximum slope?

A. I can appreciate that.

***

[2544] Q. Dr. Fuller, I want to get one thing in to the jury understand here that tensile strength, you agree, is calculated by dividing the maximum slope by the cross-sectional area of the specimen?

A. Yes, I do.

Q. Let’s go to the second to last page, page eight, and the ASTM method for this is not slope of strain hardening. Do you understand that, sir? It’s on page eight the left-hand side.

***

244a Q. And this is not slope of strain hardening;

correct?


Q. But it’s using a tensile curve?

A. It is a tensile curve.

Q. And it states that “in the case of a material that does not exhibit any linear region, the same kind of toe [2545] correction of the twenty strain point can be made by constructing a tangent to the maximum slope at the inflection point.” Do you see that?

A. Yes.

Q. That would be a determination of maximum slope; is that correct?

A. Near the — it’s in the early part. I mean, it’s when you’re just starting to pull on the material.

Q. Right. I said it was not the slope of strain hardening.

A. You’re for away from that.

Q. My point is, sir, that persons in the art know how to determine maximum slopes, don’t they?

A. Yes.

***

[2600]

***

RECROSS-EXAMINATION

[2601]

BY MR. NIMROD:

245a Q. Dr. Fuller, you were asked questions about

whether there was different ways of calculating maximum slope?

A. Yes.

Q. You would agree, would you not, that there’s only one true maximum slope on each curve in the strain hardening region?

A. If you have noise, if you have spurious squiggles, then you can have artifacts, and it’s up to you whether or not you want to call that a true maximum or not. I would be more conservative and not use that data.

Q. You would do that. If you take into account the artifacts, you can say there’s only one true maximum. That’s the definition of maximum. Maximum is the highest?

A. You can have a local maximum, a single maximum. You can have multiple maximums that have the same value. If you’re talking about a curve in general —

Q. In the strain hardening region there’s only one true maximum if you take away artifacts. Isn’t that what maximum means? [2602]

A. Yes, you would have one maximum.

***

246a UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

————

C.A. No. 05-737-JJF

————


Plaintiff,

v.


Defendants.

————




June 14, 2010

————

***

[3037]

***

THE COURT: All right. Be seated, please. All right. Ladies and gentlemen, I am now going to give you the instructions.

***

[3063]

***

247a Nova also contends that one or more of the claims of

the ‘053 patent and/or the ‘023 patent are invalid because the language of the claims is indefinite. Nova, again, has the burden of proving the claim of indefinite by clear and convincing evidence.

A claim is indefinite if a person of ordinary skill in the art cannot reasonably ascertain the proper scope of the claims even if some experimentation is needed. A patent does not need to expressly recite all the information necessary to determine whether an accused product meets a claim.

If that information would have [3064] been understood by a person of ordinary skill in the art reading the patent at the time the patent was filed, the claims are definite. If the meaning of the claim is discernable, it is definite, even though the task may be formidable and even if the conclusion may be one over which reasonable persons will disagree.

In particular, a patent does not need to recite all of the conditions for conducting a test required by a claim. In such a case, the claim would be definite if a person of ordinary skill in the art reading the patent would understand how to perform the test.

Where there is more than one method of measurement and the patent does not explicitly discuss the methods, persons experienced in the field are reasonably deemed to [select] the method that best measures the parameters relevant to the invention.

Definiteness is determined from the point of view of the hypothetical person of ordinary skill in the art, as I’ve said, on the date the patents were filed. In this case, again, that’s April 28th, 1993. [3065]

248a Post-filing date developments are irrelevant to an

indefiniteness inquiry. Person of ordinary skill in the art is presumed to know everything that was known to persons of ordinary skill in the art at the time and including the contents of all available publications.

The question is not whether a claim is definite to you as a lay person. The question is whether it could be understood by a person of ordinary skill in the art.

***

249a APPENDIX J

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

————

C.A. No. 05-737 (JJF)

————


Plaintiff,

v.

NOVA CHEMICALS CORPORATION (CANADA), and NOVA CHEMICALS INC. (DELAWARE),

Defendants.

————

VERDICT FORM

I. INFRINGEMENT QUESTIONS

(1) Did Dow prove by a preponderance of the evidence that FPs016 category polymers infringe any claim of the Asserted Patents?

Yes: __X__ No: ____ (For Dow) (For NOVA)

(2) Did Dow prove by a preponderance of the evidence that FPs117 category polymers infringe any claim of the Asserted Patents?


250a (3) Did Dow prove by a preponderance of the

evidence that FPs317 category polymers infringe any claim of the Asserted Patents?


(4) Did Dow prove by a preponderance of the evidence that NOVA’s XJS polymers infringe a claim of the Asserted Patents?

Yes: __X__ No ____ (For Dow) (For NOVA)

II. INVALIDITY QUESTIONS

(5) Did NOVA prove by clear and convincing evidence that the Asserted Patents are invalid because they lack an adequate written description of the claimed invention?

Yes ____ No: __X__ (For Dow) (For NOVA)

(6) Did NOVA prove by clear and convincing evidence that the claims of the Asserted Patents are invalid because the claims are indefinite?

Yes: ____ No: __X__ (For Dow) (For NOVA)

(7) Did NOVA prove by clear and convincing evidence that the claims of Asserted Patents are invalid because the invention defined in the claims of the Asserted Patents would have been obvious to a person of ordinary skill in the field of the invention as of the date of the invention?

Yes: ____ No: __X__ (For Dow) (For NOVA)

251a III. DAMAGES QUESTIONS

Only if you answered “Yes” to an Infringement Question (1-4) and “No” to all of the Invalidity Questions (5-7), answer the Damages Questions (8-9) below.

(8) How much did Dow prove it is entitled to as a result of NOVA’s infringement of the Asserted Patents?

Amount $61,770,994.60

(9) Of this amount, how much was for a reasonable royalty: $4,323,969.62 and how much was for lost profits: $57,447,024.98

Dated: 6-15-2010 Signed:

/s/ [Illegible] For[Illegible]

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