Federal Circuit: No Infringement without Analyzing Environment

In a recent case before the Federal Circuit, INVT SPE LLC (INVT) appealed from a determination by the International Trade Commission (Commission or ITC) that Apple Inc., HTC Corporation, HTC America, Inc., ZTE Corporation, and ZTE (USA) Inc. did not violate 19 U.S.C. § 1337 by the importation and sale of personal electronic devices, such as smartphones, smart watches, and tablets. 19 U.S.C. § 1337 deals with unfair practices in import trade, including importing goods that infringe a valid and enforceable United States patent. INVT’s complaint alleged that the devices at issue infringed five INVT patents, only two of which were at issue in the appeal. The court noted that

For infringement purposes, a computer-implemented claim drawn to a functional capability requires some showing that the accused computer-implemented device is programmed or otherwise configured, without modification, to perform the claimed function when in operation. We affirm the noninfringement finding in this case because INVT failed to introduce any evidence to establish that the accused devices, when put into operation, will ever perform the particular functions recited in the asserted claims.

The court explained,

To determine whether an accused device is a device with the “capability” of performing the recited functions, it must be able to perform those functions when it is activated and put into operation. ... Here, that means that the accused device receives and then decodes and demodulates a data signal with a particular claimed protocol—using the same parameters it had previously chosen. In this case, the user device’s capability is dependent on the base station’s capability.

The base station, said the court,

is part of “the environment” in which the user device must function. …The claims have specific requirements for the data signal that the user device’s receiving section and data obtaining section handle and process when the device is activated and put into operation. That received data signal must be modulated and encoded with specific parameters—and not by the claimed user device but by a separate base station.

The court noted that

Where claim language recites ‘capability, as opposed to actual operation,’ an apparatus that is ‘reasonably capable’ of performing the claimed functions ‘without significant alterations’ can infringe those claims…. In contexts involving software functionality, we have never suggested that reasonable capability can be established without any evidence or undisputed knowledge of an instance that the accused product performs the claimed function when placed in operation.

Said the court:

Because we require claim limitations to have some teeth and meaning, proof of reasonable capability of performing claimed functions requires, at least as a general matter, proof that an accused product—when put into operation—in fact executes all of the claimed functions at least some of the time or at least once in the claim-required environment.

The court determined that INVT had failed to make the requisite showing:

Because the communicating party (base station) generates the necessary environment, its operations must be known to determine whether the accused device infringes, i.e., is capable of performing the claimed functions.

Thus, INVT had failed to show infringement, even though its patent claims are drawn to the capability of its inventions.