IP UPDATE

Damages? Apportionment among licensed properties is essential, $10 million award reduced to $1

by Dexter Hamilton | Oct 9, 2025 | Patents

The US Court of Appeals for the Federal Circuit affirmed a district court decision excluding a damages expert’s testimony and reducing a jury’s $10 million damages award to nominal damages. The Court found that the plaintiff failed to put forth evidence from which a jury could reasonably determine damages without speculation. Rex Medical, L.P. v. Intuitive Surgical, Inc., Intuitive Surgical Operations, Inc., Intuitive Surgical Holdings, LLC, Case No. 24-1342 (Fed. Cir. Sept. 8, 2025) (Dyk, Prost, Stoll JJ.)

Rex Medical sued Intuitive for patent infringement. Initially, Rex asserted two related patents directed to systems for stapling tissue during surgery. Intuitive filed a petition for inter partes review (IPR) against one of the patents, and Rex withdrew it from the case.

Rex’s damages expert then opined that a hypothetical negotiation for a license to the remaining patent would have resulted in a $20 million payment. As support, he cited a prior settlement agreement between Rex and Covidien in which Rex asserted both patents before dropping the remaining asserted patent here from that case. Rex and Covidien ultimately settled, with Covidien paying $10 million to license both of the originally asserted patents alongside “eight other U.S. patents, seven U.S. patent applications and nineteen patents or applications from countries outside the United States.”

Intuitive moved to preclude Rex’s expert’s testimony regarding the Covidien license, and the district court granted the motion. Nonetheless, the jury returned an infringement verdict and granted $10 million in damages. Intuitive filed a renewed motion for judgment as a matter of law (JMOL). The district court denied the motion with respect to infringement and validity, but agreed on damages, reducing the award to $1. Rex appealed, challenging the exclusion of its expert’s testimony and the reduction of the damages award.

The Federal Circuit first addressed the exclusion of the expert testimony, reviewing for abuse of discretion. The Court noted that “[w]hen relying on comparable licenses to prove a reasonable royalty, we require a party to ‘account for differences in the technologies and economic circumstances of the contracting parties.’” The district court had held that Rex’s expert failed to adequately address the extent to which the patent dropped from this case and other patents included in the Covidien license contributed to the value of the license. As the Federal Circuit explained, the expert did not allocate the payment between the licensed patents and applications. Thus, the Federal Circuit ruled that the district court did not err in excluding the testimony.

Second, the Federal Circuit addressed the reduction in damages. Rex argued, and the Court agreed, that the reduction was in essence a grant of JMOL of no damages. The Court reviewed for abuse of discretion and described how, at trial, Rex relied primarily on the Covidien license and lay witness testimony to prove damages. While the lay witness testified that the focus of the Covidien license was both of the patents originally asserted here, the Court noted that the patent remaining at issue in this case had been dropped from [...]

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No curtain call yet: Mixed verdict in patent, trademark, standing case

by Hannah Hurley | Oct 9, 2025 | Patents, Trademarks

The US Court of Appeals for the Federal Circuit addressed a wide array of issues in a long-running dispute over shower curtain technology. The Court provided important guidance on patent claim scope using intrinsic evidence, trademark standing and ownership of the mark in issue, trade dress functionality under TrafFix, and the need for district courts to provide a reviewable explanation when issuing patent infringement summary judgment based on the facts of this case. Focus Products Grp. Int’l, LLC v. Kartri Sales Co., Inc., Case No. 23-1446 (Fed Cir. Sept. 30, 2025) (Moore, Clevenger, Chen, JJ.)

The decade-long dispute started when Focus Products sent a cease-and-desist letter to Kartri Sales and its supplier, Marquis Mills International. The letter asserted patent infringement but was largely ignored. Focus Products then filed suit asserting three utility patents, two trademarks (HOOKLESS® and EZ ON), and unregistered trade dress rights in the appearance of its shower curtains.

Four months after the Supreme Court’s 2017 decision in TC Heartland v. Kraft Foods Group Brands, Kartri raised a venue objection and filed a motion to dismiss or transfer venue. The district court denied the motion, finding it to be unreasonably late, especially considering that Kartri actively conducted litigation after TC Heartland.

The district court construed several disputed claim terms. Based on its constructions, it found no triable issue of fact and granted summary judgment of patent infringement to Focus Products. However, the district court found genuine disputes of material fact regarding trademark and trade dress infringement and ordered a bench trial on those issues.

On the eve of trial, Kartri asserted unclean hands and equitable estoppel defenses. The district court denied these defenses because they were improperly raised for the first time immediately preceding trial.

After a bench trial, the district court held that:

Focus Products had standing to enforce the unregistered EZ ON mark.
Kartri infringed the mark and Focus Products’ trade dress, which was determined to be nonfunctional.
Kartri infringed Focus Products’ HOOKLESS® mark.

Accordingly, the district court awarded lost profits, reasonable royalties, attorneys’ fees, and enhanced damages for willful infringement. Kartri appealed.

The Federal Circuit affirmed the district court’s denial of Kartri’s motion to transfer venue under TC Heartland, finding Kartri’s objection untimely. Kartri waited four months after TC Heartland to raise the issue, during which time discovery had progressed significantly. The Court emphasized that venue objections must be raised seasonably and that continued litigation in the chosen forum may constitute forfeiture.

The Federal Circuit largely reversed the district court’s infringement findings, explaining that the district court erred in its claim construction because Focus Products had disclaimed shower rings with a flat upper edge during prosecution. While an affirmative disclaimer usually originates from the patent applicant, the Court found clear and unmistakable disavowal through the applicant’s acquiescence to the examiner’s species election, claim cancellation, and narrowed claim scope. This disclaimer was reinforced by the prosecution of a related asserted patent, which explicitly claimed the disclaimed feature. A patentee cannot try [...]

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What we have here is a failure to communicate: Expert must map all claim limitations to the accused infringement

by Benjamin Ediger, Ph.D. | Oct 2, 2025 | Patents

The US Court of Appeals for the Federal Circuit reversed jury verdicts of infringement, finding that they were not supported by substantial evidence because of deficiencies in the patent owner’s expert testimony. Finesse Wireless LLC v. AT&T Mobility LLC, Case No. 2025 WL 2713518 (Fed. Cir. Sept. 24, 2025) (Moore, C.J.; Linn, Cunningham, JJ.)

AT&T Mobility was accused of infringing two patents owned by Finesse Wireless, both directed to methods for mitigating intermodulation product interference in radios. The accused technology involved Nokia radios implementing passive intermodulation (PIM) cancellation. Nokia intervened in the case. A jury found all asserted claims valid and infringed, awarding Finesse more than $166 million in lump sum damages. AT&T and Nokia moved for judgment as a matter of law (JMOL) on both noninfringement and the damages award, and alternatively sought a new trial. The district court denied the motions. AT&T and Nokia appealed.

The Federal Circuit reversed the district court’s denial of JMOL on noninfringement and vacated the damages award, concluding that the jury verdicts were not supported by substantial evidence. The Court’s decision turned largely on shortcomings in the testimony of Finesse’s infringement expert, whose analysis was the sole basis for Finesse’s infringement case.

For the first patent, the Federal Circuit found that Finesse’s expert failed to demonstrate that Nokia’s PIM cancellation feature received all input signals required by the asserted claims. The expert relied on a Nokia diagram but misinterpreted it by mistakenly identifying a signal generated by the radio as one of the required input signals. Although the expert was made aware of the error, he did not clearly correct his position or identify alternative signals that satisfied the claim limitation. Finesse argued that the expert had corrected a “misimpression,” but the Court disagreed, finding that the expert failed to provide a clear and consistent explanation reconciling his contradictory positions.

The asserted claims of the second patent required seven multiplications involving three signals. Finesse’s expert relied solely on a Nokia document that listed only three multiplications yet equated them to the seven required by the claims. The Federal Circuit found this testimony inadequate, noting that the expert failed to explain how the three multiplications mapped to the seven required. On appeal, Finesse argued that the document actually evidenced 10 multiplications, but the Court was unpersuaded. Neither Finesse nor its expert explained how the 10 multiplications corresponded to the seven required multiplications, nor did they reconcile this new position with the expert’s prior reliance on only three multiplications.

Because Finesse failed to present expert testimony that adequately mapped each claim limitation to the accused method, the Federal Circuit reversed the jury’s infringement findings for both patents and vacated the damages award.

Practice note: The decision underscores the importance of detailed and consistent expert analysis in patent infringement cases, particularly when expert testimony is the sole basis for proving infringement.

Bank on it: Likelihood of confusion analysis requires factual consistency when evaluating DuPont factors

by Taylor MacDonald | Oct 2, 2025 | Trademarks

The US Court of Appeals for the Federal Circuit reversed in part a decision by the Trademark Trial & Appeal Board and remanded for new analysis of two factors under the Dupont likelihood of confusion test. The Court emphasized that the factual determination in factor two (similarity of the parties’ goods or services) should remain consistent through the analyses for factors one and six. Apex Bank v. CC Serve Corp., Case No. 23-2143 (Fed. Cir. Sept. 25, 2025) (Moore, Hughes, Cunningham, JJ.)

CC Serve has held a registration for the word mark ASPIRE in connection with credit card services since 1998. In 2019, Apex Bank, a Tennessee-based banking chain, filed intent-to-use applications at the US Patent & Trademark Office (PTO) for marks incorporating ASPIRE BANK for use in “banking and financing services.” CC Serve, which partners with banks to issue and service credit cards, filed a letter of protest during Apex’s trademark prosecution. Despite CC Serve’s objections, the PTO published Apex’s marks in December 2019. CC Serve then formally opposed the marks, and the Board sustained the opposition, finding a likelihood of consumer confusion. Apex appealed.

The Federal Circuit reviewed the Board’s findings under the DuPont framework, which assesses likelihood of confusion based on multiple factors. Apex challenged the Board’s analysis of three specific factors:

Factor two: Similarity of the parties’ goods/services
Factor six: Strength of the prior mark in the marketplace
Factor one: Similarity of the marks themselves

The Federal Circuit upheld the Board’s finding under factor two, agreeing that “credit card services” and “banking/financing services” are highly similar based on their definitions and market overlap.

However, the Federal Circuit found fault with the Board’s analysis under factor six, which evaluates third-party use of similar marks to determine the strength of the contested mark. Apex submitted many examples of ASPIRE marks used in both the credit card and broader financial services industries. The Board, however, narrowed its focus to only those marks used in credit card services, excluding broader banking and financial services. The Federal Circuit concluded that this was inconsistent with the Board’s finding under factor two regarding the similarity of the parties’ goods and services. The Court instructed that on remand, the Board should consider third-party ASPIRE marks across both industries.

The Federal Circuit also directed the Board to revisit factor one, which assesses the similarity of the marks in light of the strength of the prior mark. Whether the strength of CC Serve’s mark is diminished when viewed in the broader financial services context could affect the “overall commercial impression” of the marks and the likelihood of confusion.

The Federal Circuit emphasized that factual determinations, particularly regarding the similarity of goods and services, must be applied consistently across the DuPont factors. The Court therefore remanded the case to the Board for reconsideration of factors one and six considering this guidance.

Functional relationship recitation can’t overcome anticipating prior art

by Tim Dunker | Oct 2, 2025 | Patents

Underscoring functional relationships as limitations in patent claims and the importance of claim construction, the US Court of Appeals for the Federal Circuit affirmed in part, vacated in part, and remanded a Patent Trial & Appeal Board decision that found claims of a patent unpatentable notwithstanding a functional relationship recitation. Bayer Pharma Aktiengesellschaft v. Mylan Pharmaceuticals Inc., et al., Case No. 23-2434 (Fed. Cir. Sept. 23, 2025) (Moore, Cunningham, Scarsi, JJ.)

Bayer owns a patent that describes the results of a phase III clinical trial that evaluated the efficacy and safety of administering rivaroxaban with and without aspirin for the prevention of major adverse cardiac events. Certain claims require “administering to the human patient rivaroxaban and aspirin in amounts that are clinically proven effective in reducing the risk of myocardial infarction, stroke or cardiovascular death[,] wherein rivaroxaban is administered in an amount of 2.5 mg twice daily and aspirin is administered in an amount of 75 – 100 mg daily.” Other claims are directed to a once daily administration of “a first product comprising rivaroxaban and aspirin” and “a second product comprising rivaroxaban.”

Mylan challenged the patent in inter partes review (IPR), arguing that certain claims were anticipated by the Foley reference and others were obvious over Foley alone or in combination with Plosker. The Board agreed, finding all challenged claims unpatentable. Bayer appealed.

Bayer argued that the Board erred in:

Construing “clinically proven effective” as non-limiting and finding, in the alternative, that it was inherently anticipated
Construing “first product comprising rivaroxaban and aspirin” to encompass administration of rivaroxaban and aspirin as separate dosage forms
Failing to articulate why a skilled artisan would have combined Foley and Plosker with a reasonable expectation of success
Failing to analyze whether clinical proof of efficacy was an unexpected result

The Federal Circuit declined to resolve whether “clinically proven effective” is a limiting claim element, concluding that even if it were, it would not render the claims patentable. The Court explained that the phrase does not create a “new and unobvious functional relationship” with the known method of treatment. Analogizing to a hypothetical claim for a known drug method modified by a post-dated accolade (e.g., “Best Drug of 2026”), the Court emphasized that requiring clinical proof of efficacy does not transform the underlying treatment process.

Bayer relied on the Federal Circuit’s 2019 decision in Allergan Sales v. Sandoz, in which the Court found “wherein” clauses specifying safety and efficacy to be material to patentability. The Federal Circuit distinguished Allergan, noting that the claims there were written in open format and the “wherein” clauses modified the overall composition. In contrast, the claims of Bayer’s patent already specified exact dosages, and “clinically proven effective” did not modify any particular component. The Court therefore affirmed the Board’s finding of unpatentability for these claims.

However, the Federal Circuit agreed with Bayer on the construction of claims requiring a “first product comprising rivaroxaban and aspirin.” Bayer argued that this language required a single dosage [...]

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