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$120M Apple-Samsung Verdict Restored

(CN) - Lambasting its panel for appellate fact-finding in a skirmish of the Apple-Samsung smartphone patent war, a divided en banc Federal Circuit on Friday reinstated a jury's $120 million verdict - and the validity of three Apple patents.

Earlier this year, a three-judge panel of the Federal Circuit overturned a San Jose, California, jury's $119.6 million verdict in Apple's favor. The panel invalidated two Apple patents - the slide-to-unlock and autocorrect features - and additionally found that Samsung had not infringed a third "quick links" patent.

The slide-to-unlock and autocorrect features would have been obvious based on prior art, the panel found in its Feb. 26 ruling.

But the en banc court said Friday that its panel had gone on a fact-finding mission to construe the patent claim terms, essentially co-opting a federal judge and jury's task and exceeding the authority of an appeals court which can only rely on facts already on the record.

"The panel reversed nearly a dozen jury fact findings including infringement, motivation to combine, the teachings of prior art references, commercial success, industry praise, copying and long-felt need across three different patents," Circuit Judge Kimberly Moore wrote. "It did so despite the fact that some of these findings were not appealed and without ever mentioning the applicable substantial-evidence standard of review. And with regard to objective indicia, it did so in ways that departed from existing law."

Moore and the seven judges that joined her opinion noted that the three dissenting judges raised "big questions" about how the obviousness doctrine of patent law should work - but the appeals court's task is not to write new law, Moore said.

"No party - at the panel or the petition for rehearing en banc stage - invited this court to consider changing the existing law of obviousness. We did not take this case en banc to decide important legal questions about the inner workings of the law of obviousness," Moore wrote. "We have applied existing obviousness law to the facts of the case. We took this case en banc to affirm our understanding of our appellate function, to apply governing law, and to maintain our fidelity to the Supreme Court's Teva decision."

In 2015's Teva Pharmaceuticals Inc. v. Sandoz Inc., the nation's highest court ruled that findings of fact as to patent claim construction - including background science and the meaning of terms - is solely the job of a federal judge, and that appeals courts cannot rely on extra-record extrinsic evidence to make their decisions.

Instead, the justices found that appeals courts must review federal judges' decisions for clear error rather than taking a new look using a different set of facts than what's on the record.

The Federal Circuit's en banc decision also reinstated a small Samsung victory, in which the jury found Apple had infringed Samsung's patents relating to camera systems and image compression.

Circuit Judges Pauline Newman, Alan Lourie, Kathleen O'Malley, Evan Wallach, Raymond Chen, and Kara Stoll joined Moore's opinion. Circuit Judge Todd Hughes concurred in the result without opinion.

Chief Circuit Judge Sharon Prost, and Circuit Judges Timothy Dyk and Jimmie Reyna filed dissenting opinions.

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