Federal Circuit CVSG Update

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With the Supreme Court’s October 2021 Term winding down, we thought we’d check in on the cases from the Federal Circuit where the Supreme Court called for the views of the Solicitor General on whether to grant review (often called CVSGs).  We’ve discussed the CVSG process in more detail in a previous post.

Starting with the biggest CVSG news:  last Tuesday the government filed its long-awaited CVSG brief in American Axle & Manufacturing, Inc. v. Neapco Holdings LLC, just over a year after the Court sought the government’s views.  That case involves patent claims covering an industrial manufacturing process.  The petitioner asked the Supreme Court to take up (1) whether those claims are patent-eligible under Section 101 and (2) whether patent eligibility is a question of law or fact.

The government recommended that the Court grant review limited to the first question.  It noted that the Supreme Court’s existing Mayo/Alice patent-eligibility framework “has given rise to substantial uncertainty.”  And it contended that the Federal Circuit erred in holding the manufacturing-method claims in American Axle ineligible under Section 101.  The government stated that any consideration of the petition’s second, procedural question should await the Court’s clarification of the “substantive Section 101 standard.”

The government’s recommendation doesn’t necessarily mean the Court will grant certiorari.  As our readers may recall, in early 2020 the Supreme Court denied certiorari in another Section 101 case, Athena Diagnostics, Inc. v. Mayo Collaborative Services, LLC, despite the government’s suggestion that review was warranted.  But as a general matter, the Supreme Court usually grants review when the Solicitor General recommends it after a CVSG.  We’ll likely learn soon whether the Court will hear American Axle.  If it grants review, briefing will begin over the summer, and the case likely will be argued in the fall or winter.

The government also recently filed its CVSG brief in Olaf Soot Design, LLC v. Daktronics, Inc., which we described in an earlier post.  In that case, the Federal Circuit concluded that the district court erred in failing to resolve a claim-construction dispute before trial under O2 Micro International Ltd. v. Beyond Innovation Technology Co., 521 F.3d 1351 (Fed. Cir. 2008).  The Federal Circuit then construed the relevant limitation itself and held that the defendant’s products did not infringe as a matter of law under the correct construction, thus overturning a jury verdict for the patentee.

The patentee petitioned for certiorari, contending that the Federal Circuit’s decision violated its Seventh Amendment jury-trial rights.  The Supreme Court invited the government’s views, and the government filed its CVSG brief on May 11.  It recommended denying the petition, explaining that the Federal Circuit’s decision was consistent with the Supreme Court’s claim-construction precedents and general Seventh Amendment principles.  That recommendation makes Supreme Court review less likely, though the Court occasionally grants review even when the Solicitor General recommends a denial.  The patentee has since filed its supplemental brief responding to the government’s arguments and contending that the Court should nonetheless grant certiorari.  But given the government’s contrary recommendation, the clarity of the Supreme Court’s claim-construction cases, and the Federal Circuit’s settled procedures for reviewing claim-construction issues after a jury verdict, Supreme Court review seems unlikely and unnecessary.  The Court’s decision on whether to grant review in Olaf Soot is expected by late June or early July.

And even if the Court denies the Olaf Soot petition, a recent Federal Circuit decision may make it harder for litigants to prevail on claims of O2 Micro error.  In Kaufman v. Microsoft Corp., the Federal Circuit held that a defendant “failed to preserve its O2 Micro challenge” because it did not raise before trial the particular claim-scope issue it asserted on appeal, nor did it propose a specific construction that would resolve the issue.  Although the defendant had told the district court there was some general dispute about the claim term’s meaning, the Federal Circuit deemed that insufficient to preserve the O2 Micro argument for appeal.

It’s worth noting that Kaufman issued nine days after the Olaf Soot CVSG brief, and the Olaf Soot petitioner cited Kaufman in its supplemental brief, contending that Kaufman is “inconsistent” with the Federal Circuit’s Olaf Soot decision.  But unlike in Kaufman, the parties in Olaf Soot did raise the relevant claim-construction dispute before trial, so the Supreme Court may not see any inconsistency warranting review.  And if anything, Kaufman likely underscores the government’s view that review is not needed for the O2 Micro issue.

Finally, the Court has now denied review in PersonalWeb Technologies, LLC v. Patreon, Inc., another CVSGed case from the Federal Circuit.  That case involved the Kessler preclusion doctrine.  Under that doctrine, a final judgment that certain products do not infringe a patent precludes later infringement suits accusing those products—even when claim preclusion would not apply because the new acts of alleged infringement occurred after the prior judgment.  In PersonalWeb, the Federal Circuit held that the Kessler doctrine applies even when the earlier suit ended in voluntary dismissal with prejudice rather than a judgment of non-infringement.

The patentee petitioned the Supreme Court for review of that holding, and the Court issued a CVSG.  The government’s CVSG brief argued that the Federal Circuit erred in extending Kessler to judgments entered after a stipulated dismissal rather than a finding of non-infringement.  But the government nonetheless recommended denying review because “[t]he Federal Circuit’s understanding of Kessler as a gap-filling doctrine applies only in limited circumstances that are unlikely to occur with any frequency.”  And the Supreme Court heeded the government’s advice:  it denied the petition on May 16.

[View source.]

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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