Biosig Instruments, Inc. v. Nautilus, Inc. (Fed. Cir. 2015)

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Federal Circuit SealThe Federal Circuit considered the question of indefiniteness on remand from the Supreme Court's reversal in Nautilus v. Biosig and, perhaps not surprisingly, found again that the Biosig's claims were not indefinite.

To recap, this case involves claims to heart rate monitors on exercise equipment that determine heart rate by detecting electrocardiograph ("ECG") and subtracting the confounding electromyogram ("EMG") signals.  Claim 1 of U.S. Patent No. 5,337,753 is illustrative:

1.  A heart rate monitor for use by a user in association with exercise apparatus and/or exercise procedures, comprising:
    an elongate member;
    electronic circuitry including a difference amplifier having a first input terminal of a first polarity and a second input terminal of a second polarity opposite to said first polarity;
    said elongate member comprising a first half and a second half;
    a first live electrode and a first common electrode mounted on said first half in spaced relationship with each other;
    a second live electrode and a second common electrode mounted on said second half in spaced relationship with each other;
    said first and second common electrodes being connected to each other and to a point of common potential . . .  
    whereby, a first electromyogram signal will be detected between said first live electrode and said first common electrode, and a second electromyogram signal, of substantially equal magnitude and phase to said first electromyogram signal will be detected between said second live electrode and said second common electrode; so that, when said first electromyogram signal is applied to said first terminal and said second electromyogram signal is applied to said second terminal, the first and second electromyogram signals will be subtracted from each other to produce a substantially zero electromyogram signal at the output of said difference amplifier.

(where the italicized term "in spaced relationship" was at issue in the indefiniteness determination).

In the earlier proceedings in this litigation, the District Court had found the term "in spaced relationship" indefinite as a matter of law.  The Federal Circuit reversed, using its "insolubly ambiguous" test enunciated in Datamize, LLC v. Plumtree Software, Inc., 417 F.3d 1342, 1347 (Fed. Cir. 2005), to hold that the claim was amenable to construction and thus not indefinite.  Relevant to its decision on remand, the Court held that "[c]onsidering the 'intrinsic evidence,' we found that it provided 'certain inherent parameters of the claimed apparatus, which to a skilled artisan may be sufficient to understand the metes and bounds of 'spaced relationship.'"  But the Supreme Court rejected this standard, holding that "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," according to the Court, and reversed and remanded for reconsideration by the Federal Circuit under this standard.

On remand the Federal Circuit again reversed the District Court's indefiniteness determination, in an opinion by Judge Wallach joined by Judges Newman and Schall.  The opinion noted that its review is plenary on questions of law, such as indefiniteness, but that its review is based on how the claims are construed.  For claim construction, the Federal Circuit's review falls within the framework set forth by the Supreme Court in Teva Pharm. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831, 842 (2015), where conclusions of law are reviewed de novo but findings of fact ("based on extrinsic evidence") are reviewed using a "clear error" standard.  However, the opinion also stated that, provided that the District Court's construction as based solely on the intrinsic evidence there are no "facts" to be found and, thus, the Federal Circuit can apply de novo review.

Regarding the question of indefiniteness, the opinion cited precedent that "words of degree" used in a claim are not per se indefinite but depends on "whether the patent provides 'some standard for measuring that degree.'"  Enzo Biochem, Inc. v. Applera Corp., 599 F.3d 1325, 1332 (Fed. Cir. 2010); Seattle Box Co., Inc. v. Indus. Crating & Packing, Inc., 731 F.2d 818, 826 (Fed. Cir. 1984).  Nor did the panel believe that the Supreme Court's Nautilus decision was to the contrary, as the Court stated in Interval Licensing LLC v. AOL, Inc., 766 F.3d 1364, 1370 (Fed. Cir. 2014) ("Claim language employing terms of degree has long been found definite where it provided enough certainty to one of skill in the art when read in the context of the invention.")  Moreover, the opinion asserted that whether a claim limitation recited in functional language was indefinite was "highly dependent on context," i.e., the disclosure in the specification and the knowledge of those skilled in the art, citing Halliburton Energy Servs., Inc. v. M-I LLC, 514 F.3d 1244, 1255 (Fed. Cir. 2008).

The panel acknowledged that the Supreme Court had changed the standard in Nautilus, but also referenced the Court's recognition of "competing interests" (i.e., the inherent ambiguities in language and the need for sufficient certainty for the claims to satisfy their notice function), as well as the policy consideration that the definiteness requirement counters "powerful incentives to inject ambiguity into [patent] claims."  These considerations resulted, according to the panel, in the "reasonable certainty" standard that the Supreme Court mandated the Federal Circuit to apply in this case.

Turning to the claims on appeal, the opinion sets forth the parties' reasoning, wherein Nautilus contended that the Supreme Court set out a "new, stricter standard" which requires the Federal Circuit to affirm the District Court's indefiniteness conclusion.  According to Nautilus, the intrinsic evidence "point[s] in two opposite directions" and thus the claims are indefinite.  Biosig, on the other hand, argued that "reasonable certainty" is not a new standard but rather requires a "degree of clarity" consistent with a century of precedent and that the Federal Circuit's enunciation of its insolubly ambiguous standard "could send the wrong message to district courts and the patent bar."

With regard to the "reasonable certainty" standard, the panel cite (in footnotes) copious precedent for "reasonableness" in its own, Supreme Court, and other courts' cases far afield of patent law (including Palsgraf v. Long Island R.R. Co., 162 N.E. 99 (N.Y. 1928)), and then turned to how it had interpreted the "reasonable certainty" standard in DDR Holdings, LLC v. Hotels.com, 773 F.3d 1245, 1260–61 (Fed. Cir. 2014), and Interval Licensing in particular:

We do not understand the Supreme Court to have implied in Nautilus [II], and we do not hold today, that terms of degree are inherently indefinite. . . .  Although absolute or mathematical precision is not required, it is not enough as some of the language in our prior cases may have suggested to identify "some standard for measuring the scope of the phrase."  . . .  The patents' "unobtrusive manner" phrase is highly subjective, and, on its face, provides little guidance to one of skill in the art. . . .  The patents contemplate a variety of stimuli that could impact different users in different ways.  As we have explained, a term of degree fails to provide sufficient notice of its scope if it depends on the unpredictable vagaries of any one person's opinion.

With these precedents in mind, the panel concluded that Biosig's claims were not indefinite.  The opinion reminds that the Court did not express an opinion regarding whether Biosig's claims were indefinite (and thus, impliedly, that it was not constrained by that decision to come to a different conclusion under the Court's standard).  The opinion also asserts that the District Court had relied entirely on the intrinsic evidence in construing the claims related to rendering its indefiniteness determination, and thus that its review was entirely de novo.

Returning to the grounds for its earlier decision reversing the District Court, the panel states that "[w]e noted an ordinarily skilled artisan would be able to determine this language requires the spaced relationship to be neither infinitesimally small nor greater than the width of a user's hands."  Further:

[T]he district court is correct that the specification of the '753 patent does not specifically define "spaced relationship" with actual parameters, e.g., that the space between the live and common electrodes is one inch.  Nevertheless, the '753 patent's claim language, specification, and the figures illustrating the "spaced relationship" between the live and common electrodes are telling and provide sufficient clarity to skilled artisans as to the bounds of this disputed term.  For example, on the one hand, the distance between the live electrode and the common electrode cannot be greater than the width of a user's hands because claim 1 requires the live and common electrodes to independently detect electrical signals at two distinct points of a hand.  On the other hand, it is not feasible that the distance between the live and common electrodes be infinitesimally small, effectively merging the live and common electrodes into a single electrode with one detection point.  See '753 patent col. 3 ll. 26–31 (describing how each hand is placed over the live and common electrodes so that they are "in physical and electrical contact with both electrodes").

The prosecution history was not to the contrary according to the opinion, particularly with regard to the whereby clause in claim 1 that was used during reexamination to over come rejection.  This clause "describes the function of substantially removing EMG signals that necessarily follows from the previously-recited structure consisting of the elongate member, the live electrode, and the common electrode" and:

The EMG signal is detected between the live and common electrodes, which are in a "spaced relationship" with each other.  Even more significantly, the PTO examiner found this function to be "crucial" as a reason for overcoming the cited prior art and confirming the patentability of the asserted claims upon reexamination.  . . .  Thus, the recitation of this function in claim 1 is highly relevant to ascertaining the proper bounds of the "spaced relationship" between the live and common electrodes.

The panel thus concluded:

In this case, a skilled artisan would understand the inherent parameters of the invention as provided in the intrinsic evidence.  The term "spaced relationship" does not run afoul of "the innovation-discouraging 'zone of uncertainty' against which [the Supreme Court] has warned," and to the contrary, informs a skilled artisan with reasonable certainty of the scope of the claim [citing Interval Licensing, 766 F.3d at 1374 (quoting Nautilus II, 134 S. Ct. at 2130)].

Biosig Instruments, Inc. v. Nautilus, Inc. (Fed. Cir. 2015)
Panel: Circuit Judges Newman, Schall, and Wallach
Opinion by Circuit Judge Wallach

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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