The U.S. Supreme Court recently held that the U.S. Court of Appeals for the Federal Circuit, which has nationwide jurisdiction for patent cases, must give deference to a district court’s factual findings in claim construction decisions unless such findings are clearly erroneous. The ruling, authored by Justice Stephen Breyer, marks a significant departure from the Federal Circuit’s long-standing use of the de novo standard, which allowed the appellate court to consider the totality of the district court's claim constructions by reviewing all evidence anew. The new standard will now afford much more weight to factual considerations made by the district court during Markman rulings.

The Supreme Court’s opinion was announced just Tuesday in Teva Pharmaceuticals USA, Inc., et al. v. Sandoz, Inc., et al. The Court found that when a district court only reviews evidence intrinsic to the patent (i.e., the patent itself and its prosecution history with the U.S. Patent and Trademark Office), the district court's construction amounts to a legal one, which the Federal Circuit still is to consider de novo. However, if the district court turns to extrinsic evidence to aid in claim construction—for example, conflicting expert testimony on whether a particular patent claim term has a particular meaning to a person of ordinary skill in the technical field at issue—then the district court is making a factual finding. The Federal Circuit must accept this finding unless it deems the district court's evaluation of that extrinsic evidence to be in "clear error."

Justice Breyer reasoned that the district court judge is best equipped to make such subsidiary factual determinations because he or she has presided over the presentation of evidence and therefore has a comparatively greater opportunity to determine the facts than an appeals court would by merely reviewing the record on appeal. The Court’s new standard is similar to one used with other civil matters where factual findings from evidentiary hearings and trials are reviewed on appeal under a clearly erroneous standard.

Given this new level of deference, many expect the Federal Circuit to be less apt to reverse Markman rulings. It may also prompt parties to consider whether to use extrinsic evidence in a Markman claim construction hearing as a tactical means of testing whether the resulting construction will consequently be given more or less deference. The Teva opinion certainly increases the significance of claim construction, an already important phase of patent litigation.